US military threat in Iran drives up oil and gas prices

Oil prices have risen again. Last Wednesday, oil was at $65,24 per barrel. At the time of writing (Tuesday afternoon, January 27th), the oil price is $66,48 per barrel. This is partly due to the severe winter weather in the US. Refineries along the US Gulf Coast were forced to suspend production due to the winter storm. On the other hand, supplies from the Tengiz oil field in Kazakhstan have partially resumed. Production had been halted due to fires.

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Meanwhile, the situation surrounding Iran continues to preoccupy people. Concerns about possible US military intervention had temporarily subsided, but are now rising again. The US has dispatched the aircraft carrier USS Abraham Lincoln and several destroyers to Iran. President Donald Trump calls it an armada. The US Air Force has announced large-scale exercises in parts of the Middle East, Africa, and Asia. Iran has previously threatened to close the Strait of Hormuz—where a third of the world's oil trade passes—if the US attacks it. Now, it is also warning that an attack would constitute "all-out war."  

Diesel price
Diesel prices are also rising again and are at a high level compared to December. On January 27th, the price of diesel was €134,09 per 100 liters from 4.000 liters (LTO member price). Last Wednesday, January 21st, it was €133,47 per 100 liters.

Electricity
The daily average on the European Power Exchange (Epex Spot) varied last week from €102,42 on January 22 to €138,26 per MWh on January 26. 

The energy ministers of nine North Sea countries have agreed to generate an additional 100 gigawatts of offshore wind energy over the next 25 years. During the North Sea Summit, Belgium, Denmark, France, Germany, Ireland, Luxembourg, the Netherlands, Norway, and the United Kingdom also agreed to enhance cooperation, including efforts to reduce costs. They will also jointly focus on green hydrogen.

Interest in building wind farms is waning in Europe due to higher costs and lower revenues. At the end of last year, there were zero applications for the tender for a new wind farm in the North Sea in the Netherlands. The Netherlands wants to encourage this with subsidies and CfDs (Contracts for Difference).

gas price
The gas price is higher than a week ago, but has fallen slightly since its recent peak on January 23rd. At that time, the gas price was €40,04 per MWh on the TTF futures market. At the time of writing (Tuesday afternoon), it was €38,07 per MWh. By comparison, the price on January 5th was €27,40 per MWh. Winter temperatures and geopolitical tensions surrounding Iran continue to support the price.

According to the National Energy Dashboard's energy forecast, gas demand will be higher through Friday than last week. After that, temperatures will rise slightly, and gas consumption is expected to be lower than a week earlier.