Market Insights 07/03/2025

DAILY MARKET REPORT – 07/03/2025

A big downward move seen once again in yesterdays session as the market takes considerable comfort in what may be ahead.

Certainly the rapid withdrawal of long positions held by financial traders, removing over 50 TWh per week in recent weeks, seems to show they feel the news is positive for lower prices and is time to get out as selling volume outweighs buyers.

EU leaders met yesterday with a view to outlining the future of its defence. Documents appear to show the extension of gas storage rules for a further two years, but the flexibility isn’t that flexible and 90% must still be hit by 1st November. However the EU position seems to be moving away from a total ban of Russian gas hitting Europe to a consideration of pipeline gas flowing once again. Requests for transit gas via Ukraine, which ended in December, to restart as well as potential use of the undamaged Nord Stream 2 AG pipeline seem to have merit.

Analysts seem to be struggling with the concept of why the US would want to ‘own’ the damaged pipeline as this would be at odds of providing its own LNG to Europe – however it would likely have wider implications including reducing and calming energy markets not only in Europe but potentially globally. The US would be the ‘cardholder’ in this respect. It may also bolster security more widely for European nations.

It is expected the ‘peace deal’ may be signed in Saudi Arabia in the coming days with President Zelenskyy and President Trump both mentioning being there in the near future.

Yesterday saw the TTF Front Month contract settle at €38.24 (from €41.51) and the NBP Front Month contract at 93.03p (from 100.10p).

No unplanned outage this morning and we see a Norwegian flow nomination level at 333mcm (333). EU gas storage showing at 37.17% (37.32%) full as per AGSI+. LNG vessels due to arrive in UK the next couple of weeks is 9 (10).

This morning we see the Front Month TTF contract at €37, DOWN €1 to the previous settlement.

A quick check on some key contracts (rounded to nearest whole):
Curve TTF Front Month €37, Front Season €38 (vs €38 and €42)
Curve NBP Front Month 93p, Front Season 93p (vs 100p and 100p)
UK Gas NBP spot 92p (from 104p)
UK Power Base spot £93 (from £81)

UK power prices show the UK Front Month Baseload contract at £78 (£82) and Front Season at £77 (£80).

In other areas of the market Brent Oil is at $69 ($69) and EUAs are at €67 (€69). Henry Hub is at $4.30 ($4.45) and JKM is at $13.69 ($13.73) with TTF Equiv of $12.14 ($13.12).

Numbers in brackets show the previous reports value.