UPDATED: Bulgarian OTC electricity market records first deals since 2010

The Bulgarian over-the-counter (OTC) electricity market recorded its first transactions for more than four years on Friday according to ICIS data – before repeating the feat on Monday as a further deal was agreed.

The relative burst of liquidity was prompted by recent bullishness on the Romanian and Hungarian short-term spot markets, according to Bulgarian traders.

Two 5MW transactions of baseload power for Monday delivery were concluded at €41.00/MWh at 14:11 Central European time (CET) on Friday, the first brokered OTC deals since 2010.

Then on Monday a 10MW baseload deal for delivery on Tuesday changed hands at €41.50/MWh at 09:34 CET. All deals were confirmed to ICIS by multiple sources.

The transactions were brokered by Switzerland-based Tradition Financial Services (TFS).

Market participants said on Monday that high spot prices in Romania and Hungary may have been the reason behind the deals, because some companies may have decided to export towards Hungary which is facing supply shortages, one trader suggested.

In that case, an export tariff of €4.08/MWh would also apply. Participants also suggested someone may have been caught short in Hungary and long in Bulgaria.

The action could also have resulted from a company counting on importing cheap electricity from Romania until the unexpected spikes on exchange OPCOM forced it to cover the position directly in Bulgaria, a further source ventured.

On 12 April 2010 TFS announced the first OTC-brokered trade in Bulgarian power ( see EDEM 12 April 2010 ).

Local traders have previously pointed to bid and offers appearing predominantly on the TFS screen, mainly for front-month contracts, but no further deals were reported to ICIS until now. Irina Peltegova