Markets This Morning
UK wholesale gas and crude oil prices have marginally eased this morning as the markets continue to weigh the risk premium created by the ongoing conflict in the Middle East. The U.S. carried out further strikes on Iranian military infrastructure yesterday, though seven commercial energy vessels transited the Strait of Hormuz despite the heightened risk. Iran this morning threatened further strikes on Gulf state energy infrastructure if the U.S. does not back down. The front-month NBP contract is trading down 1.11p since the markets opened at a price of 129.77p per therm, the front-month Brent contract showing a similar decline, falling $0.86 and currently trading at $84.09 per barrel.
Yesterday in Summary
UK wholesale gas prices and crude oil markets extended gains on Wednesday as a fourth consecutive day of U.S. strikes on Iran deepened doubts over the memorandum of understanding’s durability. Iranian retaliatory attacks on commercial vessels and the reinstated U.S. naval blockade reduced transit through the Strait of Hormuz, pushing the geopolitical risk premium higher. The front-month NBP contract gained 2.73p to settle at 130.88p per therm. Crude oil gains were capped by stronger-than-expected inventory data, with the Brent front-month contract settling $0.22 higher at $84.95 per barrel and WTI adding $0.26 to close at $79.60 per barrel.
