A rebound across global financial markets drove gains across UK gas and power prices on Tuesday

Gas Market

Recovering stock markets and heightened weather-related demand in Asia pushed NBP prices back up on Tuesday wiping out most of Monday’s losses in the process. The front month contract settled above 90.00p per therm for the first time since December 2023, closing at 90.29p per therm, a day on day increase of 3.24p. The Spot and prompt market also exhibited day on day gains, albeit to a lesser extent than the near months. The Within day contract increased by 2.00p day on day to close at 80.05p per therm, despite the GB system being well balanced throughout the day. Day ahead closed-up by 1.58p to settle at 79.93p per therm, supported by the bullishness across global equity markets in the morning session, with gains capped by the stability of short-term supply fundamentals.

Power Market

GB Baseload curve contracts tracked gains seen across the NBP and wider energy complex on Tuesday. The September-24 contract increased by £2.80/MWh day on day to settle at £77.15/MWh. In contrast, the Day ahead product shed value on well-above-average wind levels forecast for today and the rest of the week. These higher wind levels will likely offset slightly below average solar production for the rest of the week. Day ahead settled at £54.73/MWh, down £17.52/MWh day on day. European and UK carbon prices tracked the recovery across energy and financial markets on Tuesday, with the Dec-24 EUA falling by €1.09 to close at €69.97 a tonne. The Dec-24 UKA fell by £0.69 to settle at £39.05 a tonne.

Oil Market

After a volatile day of trade on Tuesday, which saw front month Brent edge below the $76.00 a barrel mark at one point, crude oil markets eventually settled slightly higher day on day. Upside was driven by a rally across global financial markets as well as concerns over supply disruptions in the Middle East. Iran’s vow of retaliation against Israel and the U.S. has raised concerns that a wider war is brewing in the region which is supporting prices. Lower production levels at Libya’s largest oilfield is also adding to concerns around global supply tightness. Front month Brent settled at $76.48 a barrel, an increase of $0.18 day on day. WTI for September delivery finished at $73.20 a barrel, up $0.26 on Monday’s close.