Commodity Market Report

Europe energy prices long-term outlook H2 2018

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14 February 2019

Europe energy prices long-term outlook H2 2018

Report summary

Oil prices have strengthened marginally compared to our previous view. We expect prices to remain below $70/bbl for 2019/2020, but then move to sustained rises on demand growth. The gas market continues to have a less pronounced oversupply than previously anticipated and, with it, a more modest and shorter market rebalancing between 2019 and 2021. Later, Asian LNG competition will see prices rising. Current high coal prices are forecast to slowly recede to marginal cost levels as Chinese protectionist policy weakens seaborne demand and new Australian and Indonesian supply slowly enters the market. Power prices now remain above the previous view to the early 2020s and will not go under 2017 levels at any time over the remainder of the forecast. Rising fuel and carbon costs will then see power prices rise. In Europe's carbon market, we expect ETS prices to be higher than our previous outlook until the mid-2020s, before falling a little below the earlier projection in later years.

Table of contents

Tables and charts

This report includes 7 images and tables including:

  • Oil price forecast
  • Global gas price forecast
  • Coal price forecast - delivered (CFR) ARA prices (6,000 kcal/kg NAR)
  • Base load power prices by market
  • Clean spark spreads (left) and clean dark spreads (right) (low efficiency)
  • Carbon (EUA) price and fuel switching cost in power
  • GDP growth

What's included

This report contains:

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    Europe energy prices long-term outlook H2 2018

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    Europe energy prices long-term outlook H2 2018

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  • Document

    H2 2018 Europe energy pricesLIVE.xlsx

    XLSX 884.22 KB