In the day-ahead market on JEPX (Japan Electric Power Exchange), the 24-hour spot power prices on a weekly average basis for Oct 14-18 delivery slid from the previous week in East Japan (50Hz), but turned higher in West Japan (60Hz). In East Japan, post-summer heat was gradually alleviated, but the temperatures in West Japan exceeded 25 degrees mostly during the week. The highest temperature even rose near 30 degrees in some parts of Tokai and Kyushu. Power supply dwindled with a series of generation facilities off line for regular maintenance. On the other hand, air-conditioning demand failed to slow down, tightening up supply-demand fundamentals and pushing up spot prices in West Japan.

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 3.91 for Oct 14 delivery, Yen 1.89 for Oct 15 delivery, Yen 2.46 for Oct 16 delivery, Yen 1.94 for Oct 17 delivery, and Yen 0.70 for Oct 18 delivery. The East-West gap shrank from the previous week.

In the fuel markets, LNG, coal and crude oil prices weakened across the board from the end of the previous week.

DES Northeast Asia spot LNG prices hovered in the mid $13 level per mmBtu for prompt December 2024 arrival as of Oct 17, down about 20cts from the end of the previous week (Oct 11). European natural gas prices softened mostly during the week. In addition, ample availability pressured down LNG prices. The Ministry of Economy, Trade and Industry (METI) announced on Oct 16 that Japan's LNG inventories for power generation stood at 2.08 mil mt as of Oct 13, up 60,000mt from a week before. The level was up from 2.19 mil mt as of end-October last year, but up from the average of past five years at 2.02 mil mt.

FOB Newcastle thermal coal prices in Australia stood in the high $145 level per ton for October 2024 loading as of Oct 17. The level slipped by about $3 from the end of the previous week in line with a softness in gas and crude oil prices.

In the crude oil market, WTI crude for November 2024 stood at slightly above $71 as of the afternoon on Oct 18 while Brent crude for December 2024 was trading in the high $74 level. Both WTI and Brent were down about $4.50 from the end of the previous week. Crude futures came under selling pressure amid fears over a slowdown in Chinese demand, at a time when excessive concerns over the Middle East situation were alleviated.

The actual highest price during the week was at Yen 33.25 in six areas in West Japan and the System Price (SP) for Oct 18 delivery. Meanwhile, the actual lowest price during the week was at Yen 1.00 in six areas in West Japan for Oct 14 delivery.

By area, the weekly average of the 24-hour spot prices was at Yen 13.86 in Hokkaido, up Yen 0.19 from the previous week, Yen 15.05 in Tohoku, up Yen 0.25, Yen 15.41 in Tokyo, down Yen 0.46, Yen 13.33 in Chubu, up Yen 1.84, Yen 13.23 in Hokuriku and Kansai, up Yen 2.75, Yen 13.23 in Chugoku, up Yen 2.77, Yen 13.11 in Shikoku, up Yen 2.74, and Yen 12.99 in Kyushu, up Yen 3.94.

In the JEPX auction, volumes of offers were 864.09 mil kWh on a weekly average basis, down 14.2% from the previous week. Meanwhile, bids on a weekly average basis remained stable at 907.75 mil kWh. The weekly average of trade volumes shrank by 6.4% to 630.68 mil kWh.

Power demand in nine areas of Japan during Oct 14-18 was a combined 10,740.19 mil kWh, down 1.0% from 10,850.35 mil kWh during Oct 7-11. The figure was up 1.9% from the corresponding period a year earlier. Demand during Oct 16-20, 2023 after day of week adjustment was 10,540.65 mil kWh.

Deals reported on TOCOM (Tokyo Commodity Exchange) during Oct 14-18 were as below.

Deals reported on EEX (European Energy Exchange) during Oct 14-18 were as below.

In the fourth week of October, spot prices are believed to soften from the third week. In West Japan, the highest temperature stayed above 25 degrees throughout this week, but post-summer heat is expected to ease from the middle of next week, so that spot prices will likely come under downside pressure. But a further increasing number of thermal units are slated to enter regular maintenance. The loss in generation capacity will tighten up already-tight spare power supply, a factor that is expected to limit downside room in spot prices.