Gas Market
NBP price movements were mixed on Friday as geopolitical tensions, and little sign of a near-term resolution to the U.S.-Israeli war in Iran, continued to drive supply risk premium. Despite a day-on-day loss of 1.56p, April 26 remained the most expensive contract on the curve at 127.79p per therm, with the full impact of Qatari LNG supply cuts expected to be felt next month. However, reports on Friday that France and Italy were in talks with Iran about the safe passage of energy exports via the Strait of Hormuz likely provided downside further out. The Winter 26 contract posted a loss of 1.76p by the close to end the week at 119.04p per therm. Warmer temperatures and higher wind speeds from today capped Day ahead gains, with the contract posting a 0.70p day-on-day increase to close out the week at 126.00p per therm.
Power Market
GB baseload power prices were mixed on Friday, with the front month April 26 contract pressured down by losses across the NBP near curve. Further out, movement was more muted with the Winter 26 contract shedding just £0.10/MWh to close out the week at £96.90/MWh. High wind output levels expected from today weighed on the prompt market despite forecasts of slightly colder weather. The Day ahead contract fell by £0.07/MWh to settle at £57.31/MWh.
EU carbon prices recovered from an initial drop to a new 10-month low to post modest day-on-day gains. Speculation was building ahead of this week’s leaders’ summit where conversation is expected to include short-term measures to reduce the impact of EU costs on industry. Dec 26 European Allowances increased by 93 cents to settle at €69.28 a tonne.
Oil Market
Crude oil prices remained elevated on Friday as the continued closure of the Strait of Hormuz offset news that the U.S. had eased sanctions on Russian oil supplies. Oil prices fell back below $100 a barrel after Washington issued a 30-day license allowing countries to purchase Russian oil and petroleum products currently stranded at sea. Additional downward pressure came from an erroneous report that an Indian-flagged tanker had successfully sailed through the Strait of Hormuz. The market quickly reversed course, however, after it emerged that the vessel had actually departed from Oman, east of the strait, and had not transited the waterway. The clarification renewed concerns that oil supplies remain unable to pass through the critical shipping route. The front month Brent contract settled at $103.14 a barrel, its highest close since July 2022 and a week-on-week gain of 11.3%. The West Texas Intermediate (WTI) April contract gained $2.98 by the close to settle the week at $98.71 a barrel.
Markets this morning
NBP near curve contracts have retraced Friday’s losses so far this morning, with the front month contract last going through at a 4.21p premium to its previous close. As geopolitical turmoil persists across the Middle East, news yesterday that Donald Trump is speaking to seven nations about securing the Strait of Hormuz has done little to dispel supply disruption concerns. Japan and Australia said they are not planning to send ships to help escort vessels out of the region, while Iranian leadership said they are committed to keeping the passage closed. Ongoing supply disruption fears are also supporting oil prices this morning, with the front month Brent contract last going through at $103.94 a barrel.
