Geopolitical risk continues to sit behind European energy pricing, but Wednesday’s move was driven by something more immediate: a fresh outage on the Norwegian supply system that pushed gas higher across the curve. Power forwards followed gas up while the day-ahead price fell steeply on strong wind, and the wider commodity complex was quiet, with crude holding near five-month highs and coal and carbon close to unchanged.
Natural Gas
Gas rose for the second time in three sessions as supply, rather than demand, took control. Unplanned maintenance at the Troll field removed around 13 mcm/day of Norwegian capacity through to 24 October, dragging total Gassco exit nominations down 13.5 mcm to 327.6 mcm, their lowest level since 5 October, and temperatures running roughly 2°C below seasonal norms added support. UK day-ahead NBP settled 4.75p higher at 214.75 p/therm and TTF front-month equivalents rose in step, with Dutch day-ahead up about 1.7 per cent at €88.45/MWh. Further along the curve, Summer 27 added 6.75p to 168.43 p/therm and Winter 27 gained 6.04p to 160.53 p/therm, continuing a rally that has lifted the front summer contract by close to 29 per cent in a month. The supply position has worsened since: Langeled flows are down 22 mcm/day, Vesterled has fallen to zero and UKCS output has slipped 6 mcm/day, with Norwegian nominations now at 300.7 mcm/day as annual maintenance begins at Oseberg and Troll. LNG remains the counterweight, with UK sendout steady at 10 mcm/day and ten cargoes scheduled into north-west Europe between 22 and 26 October, mostly from the United States. European storage stood at roughly 74.5 per cent full on 19 October, about 8 percentage points below last year, though the deficit has narrowed from around 13 points in late August.
Electricity
UK power pulled in two directions. Day-ahead baseload fell £21.31 to £151.77/MWh and day-ahead peak dropped £13.85 to £170.60/MWh, even as gas rose, because wind’s share of generation climbed from 32.3 per cent to 41.7 per cent and pushed gas-fired output down from 32.6 per cent to 26.1 per cent. Renewables as a whole supplied over 55 per cent of the stack. That compression left CCGT margins on the prompt at or below breakeven, with fuel and carbon costs of roughly £155 to £170/MWh depending on plant efficiency against a baseload clear below £152/MWh. Intraday pricing was correspondingly volatile, running from £41.50/MWh overnight to a peak of £262.85/MWh in the evening ramp, with a zero-priced period around dawn on Thursday as wind built. Forward power, by contrast, tracked gas higher: November 26 baseload rose £4.40 to £170.22/MWh, January 27 added £5.44 to £184.00/MWh and Winter 27 closed at £128.78/MWh, up from £105.07 a month ago. Nuclear availability remains a constraint, with Heysham 2 unit 8 fully offline since early September and further outages at Heysham and Torness scheduled from mid-November. Above-average wind and a warmer medium-range forecast point to a softer prompt into next week.
Other Commodities
Brent front-month settled at $108.82/bbl, barely changed on the day but close to five-month highs, as traders weighed a deteriorating Gulf security picture against resilient physical flows. At least 18 vessels are reported to have come under fire in the Strait of Hormuz over the past fortnight, and Iran’s Revolutionary Guard Corps has said two tankers were set ablaze after hitting mines, yet regional crude exports are running above pre-war levels and Tuesday’s session had seen prices fall on hopes of US-Iran diplomatic progress. Coal was static, with API2 ARA CIF Cal-27 at $146.65 per tonne. Carbon firmed on both schemes: EUA Dec-26 rose €0.26 to €85.91 per tonne and UK ETS Dec-26 gained £0.53 to £63.96 per tonne, narrowing the UK allowance’s discount to the European contract from roughly £8.54 to £8.05 per tonne. In global LNG benchmarks, JKM front-month climbed $0.51 to $30.06/MMBtu while Henry Hub spot eased to $3.01/MMBtu, leaving the transatlantic arbitrage firmly open. Sterling was marginally firmer at 1.3394 against the dollar and 1.1930 against the euro, a small offset to dollar-denominated import costs.