Gas Market
The UK gas market was broadly flat on Thursday after a stalemate in ceasefire discussions between the U.S. and Iran while Washington backed an announcement of a ceasefire between Israel and Lebanon. However, Hezbollah have rejected that agreement for a ceasefire while Israeli military continue their offensives in Beirut. Meanwhile the U.S. House of Representatives have voted to curb Trump’s war efforts in Iran and could force him to end the war as the pressure mounts on him. The resolution would also need approval from the House of Senate before being enacted. At the end of trading, the front month for the NBP, July, was little moved from Wednesday’s close and settled at 117.93p per therm. The Winter-26 contract added just 0.35p to close at 120.21p and contracts past this settled marginally lower. Trading for the prompt was mixed yesterday with the Spot easing by a half a penny while the Day ahead product closed 0.75p higher.
Power Market
Baseload for the Day ahead returned to levels seen earlier in the week yesterday as wind generation is forecast to fall on Friday. Wind is expected to drop by around a third to 10.0GW and the Day ahead for Friday settled at £100.81, gaining 44.0% over Thursday’s price. GB baseload futures settled lower yielding to pressure from declines in the carbon market. July settled at £103.25/MWh, down £0.25/MWh.
Carbon prices continued to soften on Thursday as the recent selloff continued to devalue contracts. EUAs for Dec-26 and Dec-27 shed 2.1% or €1.71 per tonne on average yesterday which took the decline for the week to €3.36 per tonne. The Spot for EUAS settled at €75.97, down €1.60/ tonne. UKAs declined by 1.7% or £0.98 per tonne yesterday.
Oil Market
Crude oil prices fell late in the session on Thursday as investors hope for a continuation of talks between the U.S. and Iran after the ceasefire announcement between Israel and Lebanon. Brent settled $2.78 a barrel down at $95.03. The global benchmark had been trading around a dollar a barrel lower for much of the earlier part of the day. The market appears to be focusing on the possibility of a return to peace talks and the opening of the Strait of Hormuz should both sides reach an agreement. Meanwhile, oil supplies continue to tighten. The Energy information Administration (EIA) reported that U.S. crude oil reserves fell by 8 million barrels to 433.7 million barrels last week. This was more than expected and would normally be supportive of crude oil prices. OPEC’s Secretary General said yesterday that the group still stand by their forecast for demand growth of 1.2m barrels per day this year.
Markets this morning
Yesterday’s ceasefire announcement between Israel and Lebanon has largely been ignored by both sides as combat continues to be reported in southern Lebanon. It was hoped that this truce could pave the way for peace talks between Iran and the U.S. to recommence. Elsewhere the Ukrainian President has penned an open letter to his Russian counterpart suggesting a face-to-face meeting to discuss the end of that conflict. UK gas prices have eased off earlier highs with July last trading at 118.25p per therm, while the Winter contract is still showing an earlier trade that was a penny above last nights close. In the crude oil markets, Brent has eased by 49 cents to last exchange at $94.54 a barrel.
