Wednesday delivered the biggest single-session repricing of the autumn so far, and the cause was political rather than physical. UK day-ahead gas broke through 250p/therm for the first time in nearly four years, and the continental benchmark crossed €100/MWh for the first time since the 2022 crisis. The trigger was reporting that Washington has asked Gulf allies to prepare for possible military action against Iran after next week’s US midterm elections. Gas prices across the front of the curve are now up mid-teens in percentage terms on the week, and this morning has seen a sharp reversal of roughly a tenth of the move, which indicates how much of it was risk premium rather than a changed supply and demand balance.
Power followed gas up strongly, with UK day-ahead baseload settling close to £213/MWh after a rise of nearly £40, as wind fell from more than half of the generation stack to around a fifth by the evening. Intraday system prices averaged a little over £200/MWh and the evening block cleared in the high £230s, with overnight negative pricing disappearing for the first time this week. Margins are tight across the region: UK nuclear is carrying around a gigawatt of outages, Drax has withdrawn a biomass unit for the whole of next quarter one, French nuclear availability is poor and Alpine and Nordic hydro levels are well below normal. Continental day-ahead prices settled far above UK levels, so Britain is currently exporting power rather than drawing on interconnection.
The wider complex moved in the same direction. Brent settled in the mid $110s, up around six per cent on the week, before easing this morning as diplomatic contact with Tehran resumed, though Iran has rejected the latest proposals. Carbon firmed, with EU allowances near €89 per tonne and UK allowances near £66 per tonne, leaving the UK trading at a single-digit discount in sterling terms. Coal was the lone benchmark lower on the week. The structural concern remains storage: European inventories are at their weakest late-October level since 2009, the UK is only around 40 per cent full, and summer 2028 contracts now trade below the winter that follows them, which removes the usual incentive to refill.
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