Geopolitical risk continued to dominate European energy pricing into the end of last week, with record attacks on shipping in the Strait of Hormuz and unplanned Norwegian outages combining to push gas and power higher across the curve. Crude settled firmer on Friday before easing this morning on reports of a possible easing in US-Iran tensions, while carbon and currency markets were close to unchanged.
Natural Gas
Gas prices strengthened on Friday and have extended those gains this morning, driven by the supply side rather than by weather. UK NBP day-ahead settled at 224.15 p/therm, up 3.75 p/therm, with the front-month Nov-26 contract 8.86 p/therm higher at 230.84 p/therm; Dutch TTF day-ahead added €2.63/MWh to €92.80/MWh and the TTF month-ahead cleared €90/MWh for the first time since late 2022. Gassco has recorded total exit nominations of 323.9 mcm/day today, with unplanned maintenance at Sleipner, Oseberg and Asgard curtailing a combined 18.3 mcm/day, while Vesterled and Flags flows to the UK have fallen to zero and Langeled is carrying 68 mcm/day. UKCS production rose 6.1 mcm/day to 88.1 mcm/day and UK LNG sendout is expected at 18 mcm/day, 7 mcm/day above last Friday, with a well-filled arrivals schedule into Gate, Eemshaven, Montoir and Zeebrugge. European LNG regasification nominations of 276 mcm/day on Friday sat slightly below the month-to-date average, and with European storage reported to be below normal for late October and record attacks on Hormuz shipping keeping a premium in global LNG, the Q1-27 strip is holding above 229 p/therm.
Electricity
UK power tracked gas higher along the curve while the prompt moved in the opposite direction for reasons of delivery timing rather than sentiment. Day-ahead baseload settled at £37.00/MWh on Friday against £162.95/MWh the previous session, a weekend price set by strong wind output and light demand, with peak at £44.00/MWh; the current offer has recovered to £111.50/MWh. Sunday illustrated the volatility that a wind-heavy system now produces, with prices turning negative to -£16.27/MWh overnight before reaching £271.00/MWh into the evening ramp, and this morning saw a steadier climb from around £70/MWh overnight to £267.45/MWh at the morning peak with demand near 35,940 MW. Forward power followed gas, Nov-26 baseload settling £6.15/MWh higher at £180.49/MWh and Jan-27 at £193.98/MWh, with nuclear availability a persistent drag as three Heysham units sit unavailable or derated and Heysham 1 unit 1 began a 73-day planned outage on Sunday. Thin clean spark spreads mean CCGTs are being pulled in only when wind steps back, which is forecast for later this week, while interconnector flows and continental hydro continue to cushion the evening peaks.
Other Commodities
Brent month-ahead settled $3.55 higher at $116.72/bbl on Friday after approaching six-month highs, though prices have eased today as hopes of a de-escalation in US-Iran hostilities offset continued attacks on Saudi infrastructure. Coal firmed alongside the wider complex, with API2 ARA Cal 2027 adding $2.17 to $149.18/tonne. Carbon markets were quiet in both schemes: EUA Dec 26 slipped €0.21 to €86.26/tonne while UK ETS Dec 26 was effectively flat at £64.18/tonne, leaving UK allowances at roughly an £8.05/tonne discount to Europe once converted at Friday’s rate. Global gas benchmarks reflected the same European pull, with JKM month-ahead up $0.80 to $31.42/MMBtu as Europe and Asia compete for winter cargoes, while US Henry Hub spot eased $0.17 to $2.78/MMBtu, a reminder of how wide the transatlantic spread has become. Sterling was little changed at 1.1943 against the euro and 1.3372 against the dollar, adding nothing material to import costs.