In the day-ahead market on JEPX (Japan Electric Power Exchange), the 24-hour spot power prices on a weekly average basis for Feb 19-23 delivery bounced back from the previous week in both East Japan and West Japan. Freezing winter climate returned from the middle of the week onward in contrast to warm spring temperatures in the previous week. The weather also turned partly rainy in many areas. As a result, a growth in heating demand coupled with limited solar power supply pushed up spot power prices led by day time.

In Tokyo and Kansai, the key areas in East Japan and West Japan, the 24-hour average posted a difference in favor of the East by Yen 1.10 for Feb 19 delivery, Yen 0.81 for Feb 20 delivery, Yen 0.14 for Feb 21 delivery, Yen 1.02 for Feb 22 delivery, and Yen 2.23 for Feb 23 delivery.

In the fuel markets, all of LNG, coal and crude oil prices hovered in a tight range from the previous week.

DES Northeast Asia spot LNG prices hovered in the mid $8 level per mmBtu for prompt April 2024 arrival as of Feb 21, down nearly 20cts from the end of the previous week (Feb 16). The market was weighed by growing selling pressure, at a time when European natural gas prices lacked upward momentum mostly during the week. The Ministry of Economy, Trade and Industry (METI) announced on Feb 21 that Japan's LNG inventories for power generation stood at 2.13 mil mt as of Feb 18, up 80,000mt from the previous week. The level was below 2.48 mil mt as of end-February last year, but equal to the average of past five years.

FOB Newcastle thermal coal prices in Australia hovered in the high $123 level per ton for April 2024 loading as of the latter half of the week. The level was up about $1 from the end of the previous week.

In the crude oil market, WTI crude for April 2024 stood in the low $78 level as of afternoon on Feb 22 while Brent crude for April 2024 was trading in the low $83 level. Both WTI and Brent rose moderately by about 50cts from the end of the previous week. Crude prices found support from escalating tensions in the Middle East. But high price concerns loomed after the market's winning streak so far while the International Energy Agency (IEA) revised down its demand forecast for 2024. Both bullish and bearish factors played a tug of war, leaving the crude market directionless.

The actual highest price during the week was at Yen 21.27 in Hokkaido for Feb 23 delivery. Meanwhile, the actual lowest price during the week was at Yen 5.12 in four areas from Kansai to Kyushu for Feb 20 delivery.

By area, the weekly average of the 24-hour spot prices was at Yen 9.28 in Hokkaido, up Yen 1.17 from the previous week, Yen 9.41 in Tohoku, up Yen 1.29, Yen 9.84 in Tokyo, up Yen 0.77, Yen 9.72 in Chubu, up Yen 0.88, Yen 8.84 in Hokuriku, up Yen 0.83, Yen 8.58 in Kansai and Chugoku, up Yen 0.79, Yen 8.58 in Shikoku, up Yen 0.83, and Yen 8.45 in Kyushu, up Yen 1.03.

In the JEPX auction, volumes of offers were 1,159.69 mil kWh on a weekly average basis, down 10.7% from the previous week. Meanwhile, bids on a weekly average basis waned by 2.2% to 856.71 mil kWh. The weekly average of trade volumes shrank by 9.9% to 650.82 mil kWh.

Power demand in nine areas of Japan during Feb 19-23 was a combined 12,347.76 mil kWh, down 0.3% from 12,390.93 mil kWh Feb 12-16. The figure was down 7.4% from the corresponding period a year earlier. Demand during Feb 20-24, 2023 after day of week adjustment was 13,335.77 mil kWh.

In the JEPX forward market, no deals were confirmed during Feb 19-23.

Deals reported on TOCOM (Tokyo Commodity Exchange) during Feb 19-23 were as below.

Deals reported on EEX (European Energy Exchange) during Feb 19-23 were as below.

In the final week of February, spot power prices are expected to stay in the current range. The temperatures are forecast to remain higher than normal years, a factor that will likely curb heating demand. Meanwhile, the weather is forecast to turn sunny, so that day time prices are believed to come under heavier pressure than the fourth week of February. But the weather is forecast to go downhill again in the latter half of the week amid typical winter climate.