Prices resume downward trajectory as US-Iran ceasefire holds

The NBP resumed its downward trajectory on Wednesday, as the US–Iran ceasefire held and the blockade of Iranian ports continued with few reported breaches.

While Tehran maintains that the blockade is illegal, the absence of any reported military response has supported hopes that a second round of negotiations could build on recent progress, thereby easing the geopolitical risk premium embedded in prices.

Shipping through the Strait of Hormuz continues to face severe disruption, driven by security concerns, uncertainty, and escalating insurance costs, which are constraining a meaningful portion of global oil and gas supply.

Power prices edged lower on Wednesday, reflecting continued weakness across oil and gas markets.

Elexon data showed a sharp increase in wind generation, with output doubling from 8.9GW on Tuesday to 17.8GW, enabling renewables to meet a greater share of demand.

The continuation (and possible extension) of the US-Iran ceasefire helped reduce risk premiums across oil and gas markets which in turn helped power prices.

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Price commentary courtesy of Crown Gas and Power