Spanish power prices for year-ahead delivery were trading at a near two-month low Thursday morning amid a weaker Brent crude oil futures market, which would weaken generating fuels.
* Cal 19 trading at lowest since May 8
* Gas prices seen 'confirming' losses Thursday
* Coal also weak amid thin trading
Thursday morning the year-ahead contract, Cal 19, was heard trading at Eur52.15/MWh, down 85 euro cent from where it settled on OMIP Thursday.
This is the lowest level since May 8 when the price was Eur51.90/MWh, according to OMIP data.
A Spanish trader said Wednesday that the curve "is bearish with Brent -- let's see what happens with the [OPEC] meeting."
Spanish PVB gas prices saw little trading activity in the morning, although the PVB Cal 19 gas contract was at a premium of Eur1.90-2.10/MWh over the Dutch TTF equivalent, which would put it at least 20 euro cent lower on the day, taking into account the latest TTF trade at Eur19.81/MWh.
Spanish power prices have been steadily declining since May 23, when the Cal 19 contract closed at almost Eur56/MWh, but fell to Eur53.75/MWh by the beginning of June.
This was as gas prices continued to weigh on the curve as Brent futures fell from almost $80/b to $75/b, albeit with some support from the TTF and LNG prices.
The Spanish Calendar year contract is usually thinly traded and gets aid or pressure as gains or losses filter down the curve, but as the contract trades on far curve fundamentals there are usually strong price swings, according to traders.
Coal prices for year-ahead delivery into Europe have also fallen Thursday amid thin early trading, with the last trade heard at $86.10/mt, from $86.90/mt Wednesday.
Crude oil futures fell in Thursday morning trade on signs that Iran was softening its hardline opposition to OPEC increasing output levels.
