July 2018: Lowest volume since April 2017, YoY TTF growth masks Euro Gas decline, German Power drives Euro Power YoY growth.
July 2018 saw 5.953 million monthly contracts traded, down 18% MoM, with total volumes the lowest recorded since April 2017. All groups fell vs June - UK Gas most notably down 28%, with Euro Gas, Euro Power and Coal all dropping 17% MoM. YTD we have seen 51.953 million monthly contracts traded, up 9% vs YTD 2017. With MoM metrics subject to seasonal distortion, YoY metrics are a valuable insight. Emissions, Euro Gas and Euro Power are up vs this time last year, whilst UK Gas, UK Power and Coal have all fallen. With the continental heatwave predicted to last until October, how will this shape European energy demand toward the end of the year?
All gas markets fell MoM, with Gaspool showing the largest drop, retreating 38%. Exchange executions saw gains in a number of the smaller gas markets, growing their share in the recently volatile France Hubs by 13%, with Gaspool and Austria VTP also showing exchange execution growth primarily at the expense of broker bilateral. NBP retreated 28% MoM to 951 TWh, while TTF fell 16% to 1,707 TWh, 179% of NBP's volume. Broker cleared lost 3% share in NBP's volume, with broker bilateral gaining 2%. TTF had the opposite story, where broker bilateral lost 2% share to broker cleared. YoY the picture is rather varied, PSV is up 37%, and TTF gained 17%. The latter's strong influence has pushed Euro Gas up 14% YoY, however this masks a weak summer for the smaller gas markets, five out of seven show flat or lower volumes against this time last year.
Power saw MoM declines in all markets except for Belgium Power, which shows strong growth in all three metrics. Nordic Power and Italian Power saw the largest MoM decline at 25% and 23% respectively, whilst German Power fell 19% MoM. Broker bilateral lost 5% market share in German Power, with 4% moving to exchange executions. Exchange executions currently hold 23% market share in German Power, the highest since April-17. Over the past year it has hovered around the high teens, far from the 30% high seen in July 2016. Amongst other Euro Power markets, gains in market share were varied. CEE Power gained 14% in broker cleared at the cost of exchange executions, whilst Belgium Power saw a 12% decline in exchange executions split between broker cleared and broker bilateral. A quick look at YoY shows a strong picture. Euro Power is up 9% driven by German Power's 9% growth, only French Power and Dutch Power register negative change against July 2017.
Coal's downward trend continues, as all markets fell MoM, YTD and YoY. API2 fell 13% MoM with broker cleared taking 3% market share from exchange executions. CME gained 1% in cleared market share, up to 25%. API2 front month price fell 3% to $95.10 per tonne.
Emissions fell 12% MoM however is up 49% YoY. CER registered strong broker cleared volumes despite the time of year, however remains considerably down (77%) YTD vs last year. EUA prices for Dec-18 rose 16% MoM to €17.40.