Curve Jumps on Ukraine Gas Transit Concerns
European power forwards rose on Friday, tracking a rise in gas prices after Ukraine's prime minister said proposed Ukrainian sanctions against Russia could have an impact on gas transits to Europe.
German baseload power for the year ahead, calendar year 2015 , hit the 36 euro ($48.2) per MWh level for the first time since July 29 in early afternoon trade, and was last trading at 35.90 euros/MWh, up 20 cents.
The less liquid French Cal 15 contract was up 10 cents at 43.05 euros per MWh.
The German benchmark is 3.6 percent higher than before July 17, when the downing of a Malaysia Airlines flight increased tension with Russia.
The Ukrainian government is proposing that sanctions be imposed by Ukraine against 172 citizens from Russia and other countries and 65 Russian companies it said were financing "terrorism" in the country, Prime Minister Arseny Yatseniuk said.
Yatseniuk, fielding a question on Friday from a journalist on whether proposed sanctions against Russia could affect the transit of gas across Ukraine, said "all types of transit" could be hit.
"Market participants are closing out short positions in the event that it happens," a trader said. "I do not think there will be many traders who will want to be short over the weekend."
"The biggest impact is on gas," he added. British natural gas prices for delivery next winter rose 2.48 percent to 61.69 pence per therm at 1256 GMT.
Oil prices were also supportive, with Brent crude oil gaining after the United States approved air strikes against Islamist militants in northern Iraq, raising concerns over the security of oil supplies from OPEC's second-largest producer.
EU carbon prices were 2 cents higher.
In the spot market, German day-ahead baseload for Monday delivery was down 4.8 euros per megawatt-hour (MWh) from that paid for the Friday contract at 26 euros.
The equivalent French contract was down 6 euros at 14 euros per MWh.
French nuclear power availability fell below 76 percent.
(1 US dollar = 0.7468 euro)
(Reporting by Michel Rose; editing by Jason Neely)
