Gas Market
NBP curve prices traded strongly on Wednesday morning, buoyed by market sentiment that a peace deal between Ukraine and Russia appeared further away than at any point since Trump’s initial talks with Putin in February, alongside increased sanctions on Russia by the EU and UK. As a result, the NBP June contract reached a high of 91.22p/th—its first move back above 90p since early April. However, the upward momentum proved unsustainable, and contracts across the curve began retreating from their intra-day highs just before the 4pm market settlement. The front-month contract ultimately settled at 87.85p/th, marking a day-on-day loss of 1.24p. Sentiment around a peace deal remained unchanged, with the late sell-off attributed to the securing of LNG cargoes expected to arrive by the end of the month, as well as profit-taking at elevated price levels.
Power Market
GB Baseload contracts oscillated around Wednesday’s settlement, as early gains gave way to losses in the late afternoon. Prices were initially pushed higher by strength across the broader energy complex, with support from both the NBP gas and UKA markets. The Winter-25 contract rose to £90.10/MWh in early afternoon trading before a late drop in NBP gas prices pressured GB power contracts. Winter-25 ultimately settled at £88.88/MWh, down £1.22 from its earlier high.
The Dec-25 EUA bucked the strong opening in European gas markets, trading below Tuesday’s close in early session activity. After a volatile day, the contract ultimately settled lower at €72.74/tonne.
Oil Market
Crude oil markets opened positively on Wednesday morning, supported by reports from the US citing American officials who claimed that Israel intended to attack Iranian nuclear facilities. This raised concerns over potential disruptions to oil production and exports from Iran, OPEC’s third-largest producer. Additionally, the market was wary of possible Iranian retaliation, which could include blocking oil tankers in the Strait of Hormuz. However, Brent crude soon fell from its $66.63/bbl high after the Omani Foreign Minister announced fresh rounds of nuclear talks between Iran and the US, which could stall any Israeli plans. As a result, the crude oil contract for delivery in July settled 47 cents lower than the previous day, at $64.91/bbl.
Markets this morning
Wednesday’s late declines on the NBP have given way to early gains so far this morning, with the front month contract last trading at 88.80p/th, a gain of 0.95p. The bullish sentiment is evident across the curve with winter-25 trading 0.8p/th higher at 98.00p. Crude oil, however, continues to trade lower following a report that OPEC+ is discussing plans for a production increase in July, increasing the likelihood of a global oversupply of crude oil. OPEC+ appears to be abandoning its strategy of market support in favour of increasing market share as non-OPEC countries continue to produce oil.
22 May 2025
