In the day-ahead market on JEPX (Japan Electric Power Exchange), the 24-hour spot power prices on a weekly average basis for Jan 20-24 delivery stretched losses from the previous week in both East Japan (50Hz) and West Japan (60Hz). The temperatures remained relatively high across Japan, and a looming overhang in power supply weighed on spot prices. Especially in West Japan, the highest temperature in Kyushu and Shikoku rose above 15 degrees from time to time with favorable weather. As a result, spot prices in West Japan posted steeper falls than East Japan. In Kanto, the highest temperature in the metropolitan area of Tokyo exceeded 13 degrees for five consecutive days from Jan 20, or the coldest day of the year on a calendar basis. It was the longest record to see the temperatures staying above 13 degrees successively near the coldest day of the year. Reflecting such weather conditions, the JEPX auction witnessed heavy offers in more than 13 mil kWh placed each day since Jan 21 delivery, a factor that capped upside potential in spot prices.

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 4.59 for Jan 20 delivery, Yen 2.79 for Jan 21 delivery, Yen 3.14 for Jan 22 delivery, Yen 3.14 for Jan 23 delivery, and Yen 3.44 for Jan 24 delivery.

The fuel market trends in the fourth week of January were detailed as follows.

DES Northeast Asia spot LNG prices hovered in the low $14 level per mmBtu for prompt March 2025 arrival as of Jan 23, up about 80cts from the end of the previous week (Jan 17). A strength in European natural gas prices lifted the LNG market in Northeast Asia. But upside room in LNG prices was capped by growing availability and an unabated overhang in Northeast Asia. The Ministry of Economy, Trade and Industry (METI) announced on Jan 22 that Japan's LNG inventories for power generation stood at 2.32 mil mt as of Jan 19, up 210,000mt from a week before. The figure was up both from 2.15 mil mt as of end-January last year and the average of past five years at 1.96 mil mt.

FOB Newcastle thermal coal prices in Australia stood in the mid $116 level per ton for January 2025 loading as of Jan 23. The level was down more than 70cts from the end of the previous week.

In the crude oil market, WTI crude for March 2025 stood in the low $74 level per barrel as of the morning on Jan 24 while Brent crude for March 2025 was trading in the high $77 level. Both WTI and Brent gave up about $3 from with the end of the previous week. US President Donald Trump declared a national emergency on Jan 20, the first day that he took his oath of office. Trump showed his intention to boost crude oil production in US, in a bid to pull down domestic energy prices. In addition, Trump attended the World Economic Forum's annual meeting in Davos via online on Jan 23 and reckoned that he would request Saudi Arabia and the Organization of the Petroleum Exporting Countries (OPEC) to reduce crude oil prices. The energy-related polity by Trump spurred sell-offs in crude futures.

The actual highest price during the week was at Yen 18.57 in Hokkaido for Jan 20 delivery. Meanwhile, the actual lowest price during the week was at Yen 0.01 in Shikoku for Jan 20 delivery, Kyushu for Jan 21 delivery, and five areas including Hokuriku, Kansai, Chugoku, Shikoku and Kyushu for Jan 22-23 delivery.

By area, the weekly average of the 24-hour spot prices was at Yen 13.96 in Hokkaido, down Yen 1.25 from the previous week, Yen 13.33 in Tohoku, down Yen 1.52, Yen 13.46 in Tokyo, down Yen 1.41, Yen 12.97 in Chubu, down Yen 1.82, Yen 10.05 in Hokuriku, down Yen 3.86, Yen 10.04 in Kansai, down Yen 3.73, Yen 10.04 in Chugoku, down Yen 3.72, Yen 8.59 in Shikoku, down Yen 0.60, and Yen 9.92 in Kyushu, down Yen 3.05.

In the JEPX auction, volumes of offers were 1,320.43 mil kWh on a weekly average basis, up 5.0% from the previous week. Meanwhile, bids on a weekly average basis dwindled by 8.0% to 958.16 mil kWh. The weekly average of trade volumes decreased by 3.7% to 807.09 mil kWh.

Power demand in nine areas of Japan during Jan 20-24 was a combined 13,260.68 mil kWh, down 6.2% from 14,132.52 mil kWh during Jan 13-17. The figure was down 7.2% from the corresponding period a year earlier. Demand during Jan 22-26, 2024 after day of week adjustment was 14,285.75 mil kWh.

Deals reported on TOCOM (Tokyo Commodity Exchange) during Jan 20-24 were as below.

Deals reported on EEX (European Energy Exchange) during Jan 20-24 were as below.

In the final week of January, spot prices are believed to have limited upside potential. The temperatures are forecast to stay relatively high across Japan, and heating demand will likely remain at the low ebb. Meanwhile, the weather is forecast to go downhill at the beginning of the week, but sunshine will be available in broad areas from the middle of the week onward. Thus, solar power supply is likely to grow through the latter half of the week, a factor that will weigh on day time prices. A source at a power producer and supplier said, "I believe the 24-hour average will hover in the Yen 12-14 levels in East Japan and the Yen 10-12 levels in West Japan in the final week of January."