UK NBP gas market surpassed previous extraordinary highs

 Prices soared across all major European hubs

The UK NBP gas market continued to break records as pricing surpassed previous extraordinary highs with the forward curve and prompt markets settled between 90.00p and 105.00p higher.  Prices soared across all major European hubs as the ongoing war in Ukraine caused consternation on energy markets.  The front month peaked at 463.00p per therm and then fell to a low of 323.00p before settling at 401.00p, a gain of 111.00p from the previous close.  Both the Summer 2022 and Winter 2022 posted huge gains of 120.00p and 99.43p respectively.  This is now the fourth occasion that the gas market has reached these elevated levels in the last 5 months.  It remains to be seen if the market can hold on to these gains in the coming days.

GB baseload power contracts soared higher on Wednesday

GB baseload power contracts soared higher on Wednesday and broadly followed the NBP gas market higher.  All contracts posted large increases although the exact extent of these gains was hard to determine given most settlement prices and bid/offer spreads were based on assessments.  The Winter 2022 baseload contract was the exception to this and if closed at £330.12/MWh, up by £78.15.  Carbon EUAs experienced another day of price pressure with 2022 allowances falling to €55.00 per tonne at one stage.  The market staged a rally and 2022 closed at €68.49 per tonne.

 The crude oil market extended gains for the third session in a row

The crude oil market extended gains for the third session in a row as the market remained firmly focused on the terrible events in Ukraine and the potential for interruption to Russian energy supplies.  Brent crude for May delivery peaked on the day at $113.94 a barrel and fell to a low of $106.83 at one stage.  At market settlement the contract was priced at $112.93, up by $7.96 on the day of volatile trading.  Crude oil has not been at this elevated level since the period between 2011 and 2013 when crude had an average settlement price of just over $110 a barrel.  On EUA carbon markets the 2022 contract fell to a low of €55.00 per tonne but rallied strongly in the latter part of the session and closed at €68.49 per tonne, down by €1.25.

The sell off on carbon continues with prices lower by €3.70

The gas market this morning has opened as a mirror to yesterday’s session with all contracts that have traded coming in at over 430.00p per therm.  The market has now changed tack with premium reducing. Latest trades for the front two months are showing some losses with the front month down by 7.00p and May down by 10.00p.  The trend in the market is hard to define at this stage with bid/offers varying.  The are no trades on Summer 2022 but Winter 2022 contract has last traded at 360.00p, down by 10.15p.  The sell off on carbon continues with prices lower by €3.70.  Crude oil is priced at $115.10, up by $3.06.

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