Wholesale gas and electricity prices remain significantly higher than we are comfortable with, albeit they did drop yesterday based on the latest US sentiment.

We expect continued volatility until the situation in the Gulf becomes clearer and our advice for now is definitely not to lock in to long-term contracts at the current prices, which are inflated by the Iran war.

Gas: Gas prices softened yesterday, tracking the sentiment around the US potentially leaving Iran within 3 weeks, after the US president posted on social media that “the hard part is done”. In the near curve, fundamentals showed a mild weather outlook and decreasing demand for gas.    Power: Power prices tracked the gas market and softened. Slightly higher wind forecasts for the remainder of the week lowered prices in the prompt.    Oil: Oil prices slid 3% yesterday, reversing gains made earlier in the week, as reports suggested the war in the Middle East could be winding down. The US President said that the campaign against Iran could end within two to three weeks. However, uncertainty remains around how supply chains could be revived and whether this statement from the US will prove accurate.  Carbon (EUAs): The ICE Dec-26 rose to €72.51/t yesterday. The contract opened this morning at €72.51/t.    Carbon (UKAs): The ICE Dec-26 rose to £41.55/t in yesterday’s session. Opening this morning at £41.7/t.

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