An afternoon slump on Tuesday saw near curve contracts go from spending much of the session 2p below Monday’s close, to settle more than 6p lower day-on-day

Gas Market

An afternoon slump on Tuesday saw near curve contracts go from spending much of the session 2p below Monday’s close, to settle more than 6p lower day-on-day. Despite the intraday volatility, the NBP continued to shed risk premium in the face of a potential end to the Russia-Ukraine war. A milder outlook for the final month of the winter period also fed into the near curve weakness, suggesting lower levels of gas withdrawals over the period and less pressure over the summer months for storage injections. The March-25 contract fell by 6.85p to close at 105.98p per therm, its lowest close since mid-December. A comfortably supplied GB system thanks to robust Norwegian pipeline flows and LNG sendout weighed on the Spot market, with Within day falling by 3.70p. The Day ahead contract tracked its TTF counterpart lower, falling by 6.70p to end the session at 105.50p per therm.  

Power Market

A downward revision to wind output levels for the rest of the week supported GB Baseload prompt contracts on Tuesday. The Day ahead contract increased by £5.75/MWh to close out the session at £104.25/MWh. Further out, downside across the NBP weighed on near and far curve contracts. The biggest day-on-day loss was seen on the Q3 25 contract which fell by £4.80/MWh to settle at £83.35/MWh. Carbon prices retreated in line with losses across European gas hubs on Tuesday while strong selling activity encouraged further downside. The Spot EUA contract fell by €2.15 to settle at €69.88 a tonne, its lowest close since the end of December.  

Oil Market

Weak economic indicators from the U.S. and Germany weighed on oil prices on Tuesday. Industry data released yesterday showed that U.S. consumer confidence had deteriorated at its sharpest pace in over three years in February, with inflation expectations surging amid worries that U.S. President Donald Trump’s push for trade tariffs on imports would raise prices for households. Meanwhile, the German economy, which is Europe’s largest, shrank by 0.2% in the final quarter of 2024, stirring concerns around global oil demand levels. The front month Brent contract fell by $1.76 to settle at $73.02 a barrel, a fresh two-month low. The WTI April contract posted a $1.77 loss to close out the day at $68.93 a barrel.  

Markets this morning

Yesterday’s downside has continued into this morning’s session at the NBP, with the front month contract last going through at a 3.18p discount to its previous close. Higher gas for power consumption forecast for this week is supporting the Day ahead contract, which last transacted at 106.75p per therm, up 1.25p day-on-day. The Spot market has shrugged off support from an undersupplied system, opting to trade sideways instead. Oil markets are also flat this morning, with the potential for a peace deal between Russia and Ukraine hampering any upside. Front month Brent last went through at $73.08 a barrel, up just 6 cents on the previous close.