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Markets soar out of control

Close price: The very worse case fears, and now coming to realisation. We are seeing the very worse case scenarios start to play out in the lead up to Winter. Yesterday saw the largest daily jump since March.

The global energy network is in a fragile state, and all its taking is one off events and outages to throw prices out of control. It like a Jenga tower. Take a block out, you should be okay. Take enough blocks out, the tower collapses. That hypothetical tower is now swaying.

French Nuclear outages, further heatwaves in Europe on the way, and Gas flows through Nord Stream 1 reduced to 20% have all led to prices soaring.

In some positive news,  EU energy ministers have agreed to a 15% gas savings regulation with exemptions. If we get a mild Winter, that could just about get us through it safely. That’s if they hit the reduction pledge, however. The market is clearly less than convinced.   

Opening price: Prices are up to new uncharted values this morning. There is a lot of strength in oil prices again, following a larger than expected decline in U.S inventories and overall supply concerns. Winter 22 just traded at 525p/therm. Another record day expected in the markets.