Who let the bulls out? Commodity prices have been on a massive ride since November last year, climbing to well above their 5y averages by May, from historical lows just a year ago.
A couple of highlights:
1. EU carbon prices jumped to above €50/t, their highest level on record, amidst more ambitious climate targets;
2. JKM summer prices are at $10/mmbtu and TTF DA is at $9/mmbtu -a 5-fold rise from last year and almost the double of their 5y May averages;
3. Newcastle coal is nearing $100/t, increasing by almost two-fold from last year; Rotterdam coal is on a similar trajectory;
4. In Germany, the front year power contract hit a 12 year high, with prices nearing €65/MWh;
5. Brent is trading close to $70/barrel, 25% above its 5y average and despite persisting travel restrictions.
The synchronous rise in commodity prices highlights the multiple inter-dependencies existing amongst them and highlights the importance of cross-commodity analysis in an increasingly complex global energy market.
What is your view? How long will the bull ride last? What are the main upside/downside risks?
Source: Greg Molnar
See original post by Greg at LinkedIn