Markets This Morning
UK wholesale gas prices have risen sharply this morning as geopolitical tensions escalated following Iran’s warning that it could target US military bases in Europe if they are used to launch strikes against Iranian territory. Revised forecasts for colder temperatures across the UK and Europe have also strengthened expectations for gas demand, while supply concerns have intensified following an extension of the outage at Norway’s Troll gas field, with the duration of the disruption remaining uncertain. The front-month NBP contract is trading 8.53p higher at 224.57p/therm, while the Q1-27 contract has gained 8.14p to 220.00p/therm. Meanwhile, Brent crude has edged $0.50 lower to $92.26/bbl, with rising OPEC production and a build in US crude inventories last week weighing on prices despite continued geopolitical uncertainty.
Yesterday in Summary
UK wholesale gas and oil prices rose on Wednesday as renewed US–Iran tensions raised concerns over prolonged Middle Eastern supply disruptions. Iran’s refusal to allow enriched nuclear material to leave the country complicated prospects for peace negotiations, while continued attacks on vessels in the Strait of Hormuz heightened supply risks. Front-month NBP gas gained 4.75p to 216.04p/therm, supported by reduced Norwegian flows and tightening European storage, while Brent crude rose 1.39% to $92.76/bbl. GB baseload power also climbed £8.15 to £182.65/MWh amid lower wind forecasts for next week while EUAs gained 1.7% to €89.56/tonne on stronger EU equities.
