OPEC will unveil its annual World Oil Outlook in Vienna on Tuesday, with the assessment of world supply and demand over the next two decades being closely watched.
Spot prices in the CIF ARA thermal coal market come into focus as they lie on the cusp of trading above $100/mt for the first time since 2012.
In EU carbon, negotiators from the EU Parliament, Council and Commission are set to meet midweek in what could be a final deal to overhaul the market after 2020.
Meanwhile, in European electricity, French supply security will come into focus as grid operator RTE delivers its winter outlook.
In steel, European hot rolled coil import volumes are likely to slip in the coming months given the tight spread between domestic and third-country prices.
Finally, liner companies are hoping they can hold on to some of their November 1 box rate increases this week. Demand was good for the North Asia to UK Continent route..
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Video Transcript
Market Movers Europe, Nov 6-10: OPEC unveils annual World Oil Outlook; EU close to major carbon market reforms; European thermal coal prices approach $100/mt
With Stefan Swanepoel, metals analyst
In this week’s highlights: OPEC unveils its annual World Oil Outlook in Vienna, European thermal coal prices approach a hundred dollars a metric ton; EU close to major carbon market reforms.
In oil news, OPEC will unveil its annual World Oil Outlook in Vienna Tuesday. The assessment of world supply and demand over the next two decades is closely watched, not least for signs of any change in approach by OPEC producers themselves. It coincides with the UN’s Climate Change Conference in Bonn, Germany, which will be attended by many energy and oil ministers from around the world. Platts will also publish this week its latest monthly survey of OPEC oil production.
Spot prices in the CIF ARA thermal coal market come into focus this week, as they lie on the cusp of trading above $100/mt for the first time since 2012. While European coal-burn has been relatively weak, traders have focused on potential tightening of the supply base. South African coal miners are threatening strike action and the country’s National Union of Miners says its negotiations with producers could come to a head by the middle of this week.
Our question this week is “Do you see European thermal coal prices sustaining these levels?” Please get back to us with your thoughts by tweeting with the hashtag #PlattsMM
In the EU carbon market, negotiators from the EU Parliament, Council and Commission are set to meet Wednesday in what could be a final deal to overhaul the market after 2020, including key measures that aim to tighten supply. Wednesday’s meeting is the sixth such meeting on the reforms, and could lead to an informal deal between the parliament and council, which has been more than two years in the making, as Europe seeks to deal with a long-running surplus of carbon allowances that has kept prices below 10 euros since 2012.
In European electricity, French supply security will come into focus as grid operator RTE delivers its winter outlook at a time when nuclear operator EDF struggles to return reactors as planned and some 17 units are now scheduled for restart before December. On Tuesday traders will closely watch RTE’s contingency plans in case of further delays combining with the onset of colder weather. European power prices could see a spike, especially with coal prices also rallying to a four-year high. The French TSO will also provide a glimpse of the future with its 2035 perspectives as France plans to reduce the share of nuclear in its power mix - another bullish factor for power prices if implemented.
European hot rolled coil import volumes are likely to slip in the coming months given the tight spread between domestic and third-country prices, according to an analysis by Platts. This reduction could bolster the pricing expectations of mills, provided import offer prices do not drop significantly. Russian export quotations have already receded in recent days, with one mill eager to sell remaining November production.
Liner companies are hoping they can hold on to some of their November 1 box rate increases this week. Demand was good for the North Asia to UK Continent route, and looked set to continue, but carriers quickly realized they couldn’t meet cargo allocations targets due to excess vessel capacity. This has forced them to backtrack immediately on a hefty price hike of $350, taking a container to the equivalent of $1,400 a unit, cutting it by $100 the very next day – and raising the prospect of more rate reductions until they’re back down to October’s level.
Thanks for kicking off your Monday with us and have a great week ahead.