Markets This Morning
British wholesale gas prices rose on Monday morning as hopes for a reopening of the Strait of Hormuz faded amid stalled US-Iran negotiations. The front-month Sep-26 NBP contract is up 1.77p at 153p/therm. Over the weekend, Iranian Foreign Minister Abbas Araqchi said Iran had yet to decide whether to resume talks with the US, while the June Memorandum of Understanding between the two sides is due to expire today. Cooler temperatures are forecast across northwest Europe over the next 15 days, which should ease constraints on the French nuclear fleet and reduce gas-for-power demand. Brent crude is up $0.49 at $89.01/bbl as the market continues to balance the risk of prolonged supply disruption against the possibility of a diplomatic breakthrough and reopening of the Strait of Hormuz.
Friday in Summary
Friday saw energy markets remain supported by a combination of geopolitical tensions and tighter regional fundamentals. The UK gas NBP Sep-26 contract rose 2.75p to 151.23p/therm as US-Iran tensions, French nuclear outages and strong European storage demand supported the forward curve. EUA futures eased to €81.79/tonne amid thin summer trading despite firmer energy markets. Brent climbed $1.45 on the day to $88.52/bbl, up 5.95% on the week, as stalled US-Iran talks, tanker attacks and disruption to Russian Black Sea exports heightened concerns over global supply.
