In the first week of November 2024, Brent oil futures for the Front Month on the ICE market saw fluctuations but ended the week higher than the previous Friday. On Thursday, November 7, Brent futures reached their weekly peak, settling at $75.63 per barrel, the highest price since October 26. However, by Friday, November 8, prices dropped by 2.3% to $73.87 per barrel, marking the weekly minimum. Despite the decline on Friday, the price was still 1.1% higher compared to the previous Friday, AleaSoft reports.
The initial price increase was driven by OPEC+’s decision to delay production increases, which created upward momentum. This trend continued through much of the week. However, on November 6, oil prices softened due to an increase in US oil reserves and the election victory of Donald Trump, factors that dampened market sentiment. Prices rebounded later in the week, peaking on November 7, thanks to disruptions in Gulf of Mexico production caused by Hurricane Rafael. The decline in the hurricane’s threat led to a price drop at the end of the week. Concerns about weakening demand, prompted by disappointing economic data from China, could exert downward pressure on oil prices in the second week of November.
In the TTF gas market for Front Month futures, prices increased steadily through the first week of November. On Monday, November 4, TTF gas futures hit their weekly low of €40.30/MWh, but by Friday, November 8, prices rose to €42.41/MWh, a weekly high. This represented an 8.3% increase from the previous Friday. Despite this increase, the average settlement price for the week was 0.6% lower than the previous week’s average. The surge in TTF gas prices was attributed to concerns over potential disruptions in liquefied natural gas (LNG) supply from the Gulf of Mexico due to Hurricane Rafael. Additionally, the forecasted rise in demand due to colder temperatures further supported price increases. However, European gas reserves remained at high levels, which kept prices above €40/MWh throughout the week.
In the CO2 emissions allowance futures market on the EEX for the December 2024 reference contract, prices experienced moderate fluctuations. On November 4, CO2 futures settled at €65.22/t, a 2.1% increase from the previous Friday. However, by November 6, prices had declined to €63.76/t, marking the weekly low. Prices rebounded on Thursday and Friday, reaching a weekly high of €68.02/t on November 8, a 6.5% increase from the prior Friday, and the highest settlement since September 4. Despite this rise, the weekly average was slightly lower than the previous week, down by 0.1%.
Key takeaways:
- Brent oil saw a strong start in early November, reaching a peak of $75.63/bbl, but closed the week slightly lower due to geopolitical and market concerns.
- TTF gas futures climbed steadily, with concerns over LNG supply and anticipated colder temperatures driving prices above €42/MWh.
- CO2 emission allowances experienced a rollercoaster week, with a slight overall increase, finishing at €68.02/t, reflecting higher demand and tightening emissions regulations.
Looking ahead, market participants will be closely watching global economic data and weather forecasts, particularly for energy demand shifts and potential disruptions in production, AleaSoft reports.
