Geopolitical tensions continue to drive market conditions

Geopolitical tensions in the Middle East provided the primary catalyst for market movements early on Monday, as news of weekend strikes between Iran and Israel drove strong upward support.

Prices pulled back late in the afternoon following reports that US diplomatic intervention had brokered a temporary halt to new strikes.

Despite erasing some of its earlier gains, the market still managed to finish the day in positive territory, with the Winter 26 front-season contract closing 3.6p/therm (0.12p/kWh) higher when compared to its previous settlement.

A further increase in flows from Norway continued to act as a price ceiling for the near-curve. Langeled flows hit a two-month high in yesterdays session.

Baseload prices rose on Monday as geopolitical risks and shipping disruptions in the Strait of Hormuz outweighed OPEC+ efforts to boost global production.

Despite the cartel raising output for the fourth consecutive month, Middle East supply anxiety served as the stronger driver, pushing the Brent Crude benchmark contract 1.2% higher day-on-day.

Meanwhile, nuclear power generation saw a subtle increase, meeting just under 10% of Great Britain’s total power demand.

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Price commentary courtesy of Crown Gas and Power