Forward prices edged higher on drier weather forecast

Nordic forward prices inched up on Tuesday, supported by a drier weather forecast for the hydropower dependent region.

Nordic front-quarter baseload power contract rose 0.95 euro to 71.00 euros per megawatt hour (MWh) at 11:20 GMT.

Nordic front-year gained 0.72 euro to 45.50 euros/MWh. The contract scaled its highest since December 2018 at 45.50 euros, according to Refinitiv data.

Next week will see strengthening high pressure influence, with sunnier weather with near or slightly above normal temperatures, said Georg Muller, a meteorologist at Refinitiv.

"The north will retain some low pressure activity but rain amounts will be moderate only," he added.

Nordic water reserves available 15 days ahead were seen at 22.31 terawatt hours (TWh) below normal, from 22.61 TWh below normal on Monday.

"Mostly dry weather forecasts for the Nordic region (especially next week) is driving the market with strong support from spot prices lately," said Arne Osterlind, a fund manager at Shepherd Energy.

Oil slides 2% on worries about weak demand

Prices are still "lagging a lot behind the German level for power and players are trying to buy in to the market," Osterlind further said, adding, present fundamental situation suggests Nordic Q4-21 will aim at 80 euros.

Carbon front-year allowances firmed 0.36 euro to 62.67 euros a tonne.

European next-year coal prices fell $0.75 to $120.75 a tonne.

The Nordic power price for next-day physical delivery , or system price, fell 6.48 euro to 73.74 euros/MWh at an auction on the Nord Pool exchange. The System price for Monday settled at 90.91 euros per megawatt hour, the highest since February 2012.

Germany's Cal '22 baseload, Europe's benchmark contract, rose 1.1 euro to 92.00 euros/MWh.