In some electricity markets, the price of electricity can fall below zero. A generator can effectively pay someone to take its power. Why would anyone do that? Because shutting down can sometimes be more expensive than accepting a negative price. Some generators are difficult or costly to ramp down quickly. Others may have incentives tied to continuing production. When supply overwhelms demand and transmission cannot move the excess elsewhere, prices can cross below zero. ERCOT recorded periods in 2024 when more than 40% of five minute intervals had system prices below $0/MWh. The interesting part isn’t electricity. It’s the mechanism. A price can become negative when the cost of changing your position is greater than the cost of accepting a bad price. Markets are full of situations like this. The visible price tells you what happened. The incentives explain why someone was willing to accept it. #MarketStructure# #Trading# #Economics# #EnergyMarkets#

Energy Roundup: Oil markets are once again reacting to renewed uncertainty in the Middle East as the Strait of Hormuz remains operating well below pre-war shipping levels and no formal peace agreement has been reached. 🔹 Brent crude has climbed sharply over the past week as prolonged supply disruptions and ceasefire instability continue to pressure global energy markets 🔹 Several US E&P operators are now cautiously increasing drilling activity and 2026 capital spending plans in response to expectations for higher-for-longer oil prices 🔹 The upcoming Louisiana Energy Conference will feature extensive discussions around energy transition, LNG, carbon capture, power generation, nuclear, infrastructure, and future energy investment themes Read Richard Tullis's full report for all the details! #Energy# #Oil# #NaturalGas# #OilandGas# #MiddleEast# #EnergyMarkets# #LNG# #Infrastructure# #Investing# #WaterTowerResearch#

Energy markets are foundational to our economy. They keep the lights on, fuel our industries, and provide price signals that businesses and consumers rely on every day. Yesterday's energy roundtable with leaders from across the industry will help guide the @CFTC toward making it easier for companies to access our markets and hedge their risk while they work to unleash American energy dominance.

The world’s largest energy markets are watching the rise of perpetuals. On ICE’s Q3 earnings call, Chair and CEO Jeff Sprecher cited Pyth data on oil perpetuals while discussing how these markets complement traditional futures. Pyth data is becoming part of finance’s defining conversations.

HORMUZ SHIPPING SLUMPS AS ENERGY MARKETS TIGHTEN Commercial vessel traffic through the Strait of Hormuz fell 19% last week, with daily crossings dropping to 25 from 120 before the conflict. Freight rates declined but remain nearly double pre-conflict levels. Meanwhile, refinery damage has tightened fuel supplies, boosting refining margins and petrochemical profits, while global crude inventories continue to fall.