Gas Market
UK gas prices closed slightly higher on Thursday, despite some intraday volatility. The front-month contract fell to an intra-day low of 82.34p/therm before recovering to settle up 0.75p at 84.48p/therm. Prices were supported by tighter market fundamentals, including reduced Norwegian flows due to unplanned outages at the Karsto facility, as well as geopolitical tensions following President Putin’s decision not to attend Ukraine peace talks in Turkey. Prompt prices also made gains, driven by stronger gas-for-power demand amid the ongoing supply disruptions and a forecast for lower renewable generation. The day-ahead contract, which has traded within a 79–82p/therm range this week, rose by 2.55p on the day-ahead to close at 80.75p/therm.
Power Market
GB Baseload futures settled marginally higher on Thursday, as initial optimism around the Russia-Ukraine peace talks faded after President Putin confirmed he would not attend. The front-month June contract closed £1.08 higher at £75.75/MWh. However, prompt prices moved in the opposite direction to their NBP counterpart, with the day-ahead contract falling by £3.50, or 4.55%, to £73.50/MWh amid stronger-than-expected wind generation.
In the carbon market, European carbon allowances erased the previous two days of losses, with the Dec-25 EUA contract rising €1.24 to €73.47 per tonne. Meanwhile, UKA contracts declined by 1.25% ahead of Monday’s meeting between the EU and UK to discuss linking their emissions trading systems.
Oil Market
Oil prices fell more than 2% on Thursday, weighed down by the prospect of increased global supply amid signs of progress toward a U.S.-Iran nuclear deal and a stalling stock market rally. The July Brent contract dropped $1.56, or 2.36%, to $64.53 per barrel after U.S. President Donald Trump indicated he was close to reaching an agreement with Iran, potentially leading to a relaxation of sanctions on the OPEC member. Easing sanctions could bring an additional 800,000 barrels per day of Iranian crude to the global market, intensifying concerns about oversupply. These concerns were further compounded by data from the U.S. Energy Information Administration earlier in the week, which showed crude inventories rose by 3.5 million barrels to 441.8 million barrels, in contrast to the expected draw of 1.1 million barrels.
Markets this morning
Energy markets are stable this morning, continuing the trend seen throughout the week. Near-curve gas contracts have remained rangebound between 82–85p/therm since early last week and are currently trading up by an average of 0.68p/therm, supported by a comfortable supply outlook and the absence of major geopolitical developments. Oil prices are flat, with the front-month Brent crude contract last settling at $64.40 per barrel, down just 13 cents.
16 May 2025
