Gas Market
Energy markets watched cautiously as U.S. President Donald Trump and Russian President Vladimir Putin held a phone call yesterday to discuss a potential ceasefire in the war in Ukraine. The call, which concluded later in the session, saw Putin agree to a 30-day ceasefire on energy infrastructure. This led to a late decline in gas prices, with the front-month NBP contract settling down 0.93p to 100.01p/th from the previous sessions close. However, the decline was minimal, as the call’s readouts gave no sign that Russia was open to compromising on its maximalist war aims, diminishing hopes that a ceasefire leading to lasting peace and the lifting of EU sanctions was any nearer than before the discussion. On the prompt, the day-ahead shed 2.76p to 100.18p/th amid warmer temperatures reducing heat demand for the rest of the week.
Power Market
GB baseload contracts moved in line with gas prices on Tuesday as news that Russia had agreed to 30-day ceasefire on energy infrastructure led to near curve contracts settling a marginal £0.12/MWh lower. Prompt prices increased yesterday amid low wind generation with the day ahead contract increasing £5.50 to £99.00/MWh although warmer temperatures forecast for the rest of the week limited further gains.
European carbon prices made a late rally as a body that includes members of the UK and European Union parliaments renewed a call to consider linking the UK and EU carbon markets ahead of a May summit. EUA Dec-25 increased 68c to €70.88/tonne while its UK equivalent climbed £1.38 or 3.1% to £45.75/tonne.
Oil Market
Oil prices eased by circa 1% on Tuesday after U.S. President Donald Trump and Russian President Vladimir Putin discussed potential measures to end the three-year war in Ukraine. This raised speculation about a possible easing of sanctions on Russian fuel exports, potentially increasing global oil supplies. Earlier in the day, crude futures had reached a two-week high of $72.19 per barrel due to concerns that instability in the Middle East could disrupt oil supplies, as well as optimism that economic stimulus plans in China and Germany might boost fuel demand in two of the world’s largest economies. Further gains on Tuesday were limited by ongoing concerns about the U.S. economy, as escalating and unpredictable trade wars increased the likelihood of a recession. However, the perceived positive talks between Trump and Putin eventually saw crude prices fall day on day. The Brent front month contract settled at $70.56 per barrel, a decline of 51 cents.
Markets this morning
Gas prices have strengthened across the curve following the lack of a full ceasefire agreement in yesterday’s call between Trump and Putin, keeping market participants on edge
. The NBP front month contract last traded at 103.43p/th up 3.42p. Contract on the prompt have yet to trade this morning although warmer weather forecasts are likely to limit upside provided by the increasingly volatile geopolitical climate. The losses on crude oil prices have been extended this morning following the agreement that Kyiv and Moscow would agree to 30-day pause on attacking energy infrastructure. Brent crude is down $0.38 at $70.18/bbl, skirting just above the $70.00/bbl resistance level.
19 March 2025
