Energy Market monthly recap April 2023
Follow the energy market recap of April with our video and infographic!
- Article
- 04/05/2023
April 2023 has been a relatively calm month for the energy markets, as they have been able to rely on comfortable fundamentals. Nonetheless, uncertainties persist and can impact the energy markets in the upcoming months.
China’s economy continues to recover, but there are doubts about its sustainability. The country has been one of the main drivers of the energy markets in recent years, and any significant changes in its economic performance can have a significant impact on the market.
In the US, the economy is still at risk of entering a recession this year. The banking crisis also remains a concern, as any significant event in the banking sector can lead to a significant shock in the energy markets.
In Europe, the availability of nuclear power plants remains uncertain, especially in France. This uncertainty is supporting prices, as the risk premium remains high. Germany has already shut down its last three nuclear reactors, and France will need to commit to its nuclear maintenance plan to avoid any significant supply shortages.
On the positive side, stocks are high, and LNG arrivals in Europe remain strong, contributing to lower prices. Additionally, the month’s weather has been favorable, combining windy and rather mild conditions, with stable gas prices, leading to a drop in prices.
Oil prices are back to their highest levels in recent months, following OPEC’s decision to reduce production. However, the International Energy Agency has announced higher prices by the end of the year, highlighting the volatility of the oil market.
Price volatility was most pronounced mid-month, as the 2022 compliance deadline was April. However, prices rebounded at the end of the month with renewed optimism in the financial markets.
Finally, the European Parliament formally approved the “Fit for 55” plan, which aims to reduce greenhouse gas emissions by 55% by 2030. This plan will have significant implications for the energy markets, and it remains to be seen how Europe will remain competitive in LNG supply.