In the day-ahead market on JEPX (Japan Electric Power Exchange), the 24-hour spot power prices on a weekly average basis for Dec 9-13 delivery bounced back from the previous week in both East Japan (50Hz) and West Japan (60Hz). Chilly climate went into full swing across Japan, and a pickup in heating demand gave a bullish impact on spot prices. For Dec 13 delivery, Chubu leaped to mark an abnormal high of Yen 80.00 during 06:00-06:30 hours, followed by Yen 40.00 during 06:30-07:00 hours. Spot prices tend to jump sky high for this season of the year especially in early morning when demand begins to grow but power supply is not ready to increase. Despite that, many players regarded the sudden jump to Yen 80 and Yen 40 as beyond expectations." A source at a power producer and supplier said, "As sometimes observed in summer, Chubu spiked in specific windows probably because buyers placed bids at the market." A source at another power producer and supplier said, "The spike was driven by robust buying interest by a leading retail player." Meanwhile, many players felt the phenomenon was only short-lived.

Chugoku EPC reactivated the 820MW No2 BWR (Boiling Water Reactor) at its Shimane nuclear power station in Shimane prefecture at 15:00 hours on Dec 7 following regular maintenance started on Jan 27, 2012. After the reactivation, the reactor will resume power generation in late December, and launch commercial operation in early January next year.

Kansai EPC plans to shut down the 1,180MW No4 PWR (Pressurized Water Reactor) at its Ohi nuclear power station in Fukui prefecture for regular maintenance starting Dec 14. The maintenance will last about three months.

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 2.61 for Dec 9 delivery, Yen 4.31 for Dec 10 delivery, Yen 5.04 for Dec 11 delivery, Yen 2.52 for Dec 12 delivery, and Yen 6.07 for Dec 13 delivery.

In the fuel markets, LNG and coal prices lost ground from the end of the previous week while crude oil priced headed north.

DES Northeast Asia spot LNG prices hovered in the mid $14 per mmBtu for prompt January 2025 arrival as of Dec 12, down about 50cts from the end of the previous week (Dec 6). A softness in European natural gas prices dragged down the LNG market in Northeast Asia. Ample availability in the Northeast Asia market also weighed on LNG prices. Freezing winter climate gripped Northeast Asia including Japan, but leading power producers were already well covered with term contract cargoes and earlier-procured spot cargoes, leaving limited fresh buying interest. The Ministry of Economy, Trade and Industry (METI) announced on Dec 11 that Japan's LNG inventories for power generation stood at 2.11 mil mt as of Dec 8, up 210,000mt from a week before. The figure was down both from 2.70 mil mt as of end-December last year and the average of past five years at 2.16 mil mt.

FOB Newcastle thermal coal prices in Australia stood in the mid $132 level per ton for December 2024 loading as of Dec 12. The level was down slightly less than $1 from the end of the previous week in line with a fall in gas prices.

In the crude oil market, WTI crude for January 2025 stood at slightly above $70 as of the afternoon on Dec 13 while Brent crude for February 2025 was trading in the mid $73 level. Compared with the end of the previous week, WTI gained slightly less than $3 while Brent was about $2.50 higher. Crude futures found support from uncertainty over the Middle East situation and hopes for a recovery in the Chinese economy. In addition, the European Union (EU) tightened the sanctions against Russia, injecting bullishness into crude prices. But the International Energy Agency (IEA) said in its monthly report released on Dec 12 that crude oil supply would exceed demand in 2025. The report raised concerns over loosening supply-demand fundamentals going forward, paring the gain in crude futures.

The actual highest price during the week was at Yen 80.00 in Chubu for Dec 13 delivery. Meanwhile, the actual lowest price during the week was at Yen 0.01 in Kyushu for Dec 9 delivery and Shikoku for Dec 10-11 delivery.

By area, the weekly average of the 24-hour spot prices was at Yen 11.74 in Hokkaido, down Yen 0.68 from the previous week, Yen 10.67 in Tohoku, down Yen 1.56, Yen 16.36 in Tokyo, up Yen 2.57, Yen 16.43 in Chubu, up Yen 2.64, Yen 12.25 in Hokuriku, Kansai and Chugoku, up Yen 0.12, Yen 10.50 in Shikoku, up Yen 0.90, and Yen 10.91 in Kyushu, up Yen 0.10.

In the JEPX auction, volumes of offers were 1,167.15 mil kWh on a weekly average basis, down 4.0% from the previous week. Meanwhile, bids on a weekly average basis expanded by 3.0% to 1,001.45 mil kWh. The weekly average of trade volumes increased by 0.3% to 783.55 mil kWh.

Power demand in nine areas of Japan during Dec 9-13 was a combined 13,249.23 mil kWh, up 10.5% from 11,993.04 mil kWh during Dec 2-6. The figure was up 9.4% from the corresponding period a year earlier. Demand during Dec 11-15, 2023 after day of week adjustment was 12,106.22 mil kWh.

Deals reported on TOCOM (Tokyo Commodity Exchange) during Dec 9-13 were as below.

Deals reported on EEX (European Energy Exchange) during Dec 9-13 were as below.

In the third week of December, spot prices are believed to hover in a similar range as the second week. The highest temperature is forecast to be in the range of 11-14 degrees from Kyushu to Kanto, almost steady from the second week. Heating demand is expected to some extent, but a further buildup in power supply from thermal units will likely cap upside room in spot prices. Despite that, spot prices during 06:00-08:00 hours are believed to chase upside across Japan as a pickup in morning demand will help tighten up supply-demand fundamentals. Market players doubt if the excessive price hike in Chubu after 6:00 hours for Dec 13 delivery will be repeated. But Tokyo and Chubu are likely to top Yen 20 throughout the week.