In this week's highlights: OPEC+ members itch to break free of output constraints; the jet fuel market welcomes news of a potential coronavirus vaccine; returning French nuclear generators contribute to a continental power supply glut, and mild weather is keeping European gas storage withdrawals unusually low.
OPEC+ keeps markets guessing
Returning reactors add to continental glut
Gas storage withdrawals stay low on mild weather
In this week's highlights: the jet fuel market welcomes news of a potential coronavirus vaccine, returning French nuclear generators contribute to a continental power supply glut, and mild weather is keeping European gas storage withdrawals unusually low.
But first, in oil news, market participants are very much attuned to next week's OPEC+ meeting, starting Monday the 30th, and any advance signals that the group may decide to maintain production cuts of around 7.7 million b/d, or 8% of the pre-pandemic market, rather than easing the cuts from the start of next year as planned.
Key protagonists have been non-committal so far, but there are signs of some players are itching to break free of output constraints, with a lot of attention on the UAE recently.
Africa is also in focus, as the International Energy Agency holds an online forum Tuesday with African energy ministers, led by South Africa's minerals and energy minister Samson Gwede Mantashe.
It comes amid much interest in the possibility of a new deepwater gas province off the coast of South Africa, potentially rivalling Mozambique, following recent discoveries by Total and others.
One long-standing African investor, Tullow Oil, holds a capital markets day on Wednesday, updating investors on its efforts to claw its way back from recent difficulties, boosted by a sale of Ugandan assets to Total, and with the Turkana oil project in Kenya in focus.
Here in Europe, Germany's Wintershall Dea is giving a press briefing Monday on its third quarter results and pandemic response, ranging from the North Sea to Russia to the UAE.
The European jet fuel market will be monitoring all the latest news on COVID-19 vaccines and timelines for their roll-out even more keenly than most, as the aviation sector continues to struggle with unprecedently tough market conditions. While the news of vaccines has been welcomed by the sector, any sustained rebound in jet demand is likely to have to wait until the spring of 2021, according to traders. Despite widespread restrictions on movement, jet fuel prices have found some support due to reduced supply resulting from refinery run cuts.
And that takes us to our social media question for the week: How has Coronavirus changed your perspective on transport? Tweet us with your thoughts using the hashtag #PlattsMM.
In European power, meanwhile, French nuclear generation could hit 50 GW this week as more reactors return to service after an extended period of reduced availability.
Continental Europe is increasingly awash with power, with hydro stocks high and thermal availability good. This has caused considerable weakness in spot and curve prices, with only a prolonged cold snap combined with low wind levels likely to force a correction. The exception has been the UK market, where tightness on low wind days has become worryingly frequent. Imminent commissioning of a new interconnector cable to France, however, should ease these concerns.
In the European gas market, traders will be keeping a close eye on how storage levels develop as the ongoing mild weather and healthy supply keep a lid on withdrawals.
In northwest Europe, storage withdrawals have been down on previous years, and with forecasts for a warmer-than-normal start to December, activity could remain low.
European stocks were built up to almost 100% of capacity over the summer, so a lack of withdrawals would have a bearish impact on European gas prices both on the prompt and the curve.
It comes as demand also seems to be taking something of a hit from the lockdowns imposed in a number of countries across Europe.
For more on all the issues affecting commodity markets from wherever you are, make sure to check out Platts LIVE at the address displayed on your screen.
Thanks for kicking off your Monday with us and have a great week ahead!