Prices up again amid reports of vessels being struck in Red Sea

Gas prices were up again on Thursday, with the Winter 26 front-season contract seeing an unprecedented 8-day bull run close to the 150p/therm (5.12p/kWh) psychological level.

Reports emerged yesterday that two vessels had been struck in the Red Sea. The Yemeni Houthis claimed responsibility for the attacks, which came after an embargo on Saudi tankers was declared earlier in the week.

Several vessels are understood to have abruptly diverted course in order to avoid the Strait of Bab el-Mandeb, which acts as the southern gate to the Red Sea and the Suez Canal.

With both Hormuz and now Bab el-Mandeb seeing a significant reduction in traffic, the outlook for global markets looks fairly uncertain, for the short-term at least.

Baseload power contracts continued to mirror gas counterparts on Thursday.

Though we have seen less gas-fired (CCGT) power demand so far this week, imports have been persistently high, accounting for around a quarter of supply.

The system operator NESO has published SO-SO warnings on its portal across much of the past couple of weeks, notifying participants of exceptionally high prices in peak periods.

SO-SO trades are effectively a short-notice request to neighbouring countries for exports to the British grid for balancing purposes and therefore they carry a sharp premium.

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Price commentary courtesy of Crown Gas and Power