Prices up again amid rumours of a trade war with the US

NBP gas prices were propelled to new yearly highs on Thursday, despite easing off slightly into the close.

Moderate daily gains of circa 2.3p/therm (0.08p/kWh) were posted on the March 25 front-month and Summer 25 front-season contracts amid a broadly unchanged tight supply and demand outlook.

Consistently high gas-fired power generation may have provided support to the front-month as high system demand continues to divert volumes away from crucial storage reinjections.

According to data from National Grid, the British power system has been notably gas dominated across the past few days.

On Thursday, CCGT (Combined Cycle Gas Turbines) contributed to 43.6% of the power mix across the gas-day, with wind accounting for less than half of this at just 20.7% over the same period.

Geopolitical concerns are likely serving as an underlying source of pressure for global energy markets.

Rapidly evolving US Foreign Policy under the Trump Administration has triggered fears of a potential trade war in recent weeks.

The BBC reported on Monday that when asked about potential tariffs on the EU, the President said, “I wouldn’t say there’s a timeline, but it’s going to be pretty soon.” Tariffs on EU goods could have impacts on manufacturing and economic activity that are generally hard to predict.

This new element of uncertainty has triggered volatility not just across financial/currency markets but also for fuel commodities such as oil, natural gas, coal and subsequently electricity.

Natural gas prices have resumed their upward trajectory so far this morning, with the Summer 25 front-season contract currently being offered circa 2p/therm (0.07p/kWh) above its previous settlement at time of writing.

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Price commentary courtesy of Crown Gas and Power