The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.

0839 ET - Reckitt and Unilever are more exposed to higher oil prices than other consumer goods companies, analysts at Morgan Stanley say in a note as Brent crude remains above the $100 mark. The substantial home-care businesses of Reckitt and Unilever and sensitivity to oil-linked raw materials leave them more exposed than other companies, they add.Beyond pricing, Reckitt has highlighted improvements to its supply chain and says it is manageable, the analysts add. Reckitt shares are up 0.1%, Unilever shares are up 0.5%. (aimee.look@wsj.com)

0839 ET - European gas prices are expected to remain elevated, with the TTF benchmark forecast at 75 euros a megawatt-hour by year-end, up sharply from Commerzbank's previous forecast of 50 euros. A physical shortage is unlikely, but competition for LNG is expected to remain intense, particularly as Qatar, has sharply curtailed production and shipments, according to Norman Liebke, a commodity analyst at Commerzbank. Most remaining Qatari LNG cargoes are headed to China, India and countries around the Persian Gulf, while shipments to Europe have effectively halted. Unlike oil, LNG has limited alternative export routes, increasing Europe's vulnerability. The supply outlook could tighten further from 2027 as the European Union phases out Russian LNG and pipeline-gas imports, Liebke says. TTF gas currently trades around 81 euros a megawatt-hour. (giulia.petroni@wsj.com)

0804 ET - The cost of insuring Saudi Arabia's sovereign debt against default edges higher after Houthi militants captured a Red Sea port late Thursday, an important route for Saudi's oil exports. The militants earlier this week attacked energy facilities in Saudi Arabia, raising concerns about the spread of the Middle East conflict. Saudi Arabia's 5-year sovereign credit default swaps climb 1 basis point to 59bps, the highest in three weeks, S&P Global Market Intelligence data show. (miriam.mukuru@wsj.com)

0801 ET - U.S. diesel prices extend their rally, hitting a fresh record high as severe disruptions in the Middle East and Russia keep global supplies tight ahead of winter. The national average price of diesel hit $6.0556 a gallon on Friday, the highest on record, according to the American Automobile Association. A year ago, prices averaged $3.705 a gallon. "The recent widening in the spread between the spot price of Brent crude and the front-month contract is evidence of rising strains in the physical oil market," says David Oxley from Capital Economics. "The recent upward leg in the oil price does not have the hallmarks of a risk premium-related move that could dissipate quickly but seems instead to be a reassessment that will only be soothed by a loosening in oil market conditions." (giulia.petroni@wsj.com)

0757 ET - European equity valuations are elevated on overly optimistic assumptions around the artificial intelligence-driven investment boom, Bank of America analysts write. Markets price record margin expansion and post-recession levels of earnings per share growth over the next three years, the analysts say. "We see ample scope for disappointment." Increased competition between model makers will reduce pricing power and lower margins--the same factor that has caused past tech booms to fall flat, they say. Moreover, the increased cost of money for hyperscalers, and the risk of insufficient electricity supply, will drag data center build-out on the continent. The analysts see potential for the Stoxx 600 to fall by 9% to around 580 into early 2027. The index rises 0.55% to 639.49 Friday.(josephmichael.stonor@wsj.com)

0750 ET - Oil price movements and U.S. Treasury yields are likely to be the main drivers of U.K. government-bond yields in the near term, ING economists say in a note. "For every $10 increase in oil prices, gilt yields rise by some 10 basis points to 15 bps," they say. The gilt market could stay highly volatile due to these external factors, they say. Ten-year gilt yields fall 2.5 basis points to last trade at 5.346%, after hitting a 19-year high of 5.381% on Thursday, LSEG data show. (miriam.mukuru@wsj.com)

0748 ET - Oil prices extend losses in afternoon European trading, but remain on track for weekly gains of nearly 9% as escalating attacks in the Middle East fuel fears of prolonged supply disruptions. "The key risk in the near term is that fighting causes the partial recovery in crude oil flows to go into reverse," says David Oxley from Capital Economics. "This could include affecting oil flows via the Red Sea, and/or disrupting the practice of ship-to-ship transfers, which have both been vital in allowing around 60%-80% of prewar crude oil flows to exit the Strait [of Hormuz] in recent months." Brent crude is down 3.1% to $104.33 a barrel, while WTI futures fall 2.8% to $99.63 a barrel following a Financial Times report of Middle Eastern diplomatic efforts to secure temporary shipping arrangements with Iran.(giulia.petroni@wsj.com)

0701 ET - European equities are less vulnerable to spikes in natural-gas prices than in 2022, but higher energy costs can still hurt the continent's stocks, Citi analysts write. Gas storage volumes are higher than many assume, they say, even as benchmark natural-gas prices on the continent trade at their highest levels since the end of 2022. While higher gas prices would hurt European stocks, Citi commodity analysts see European prices falling by around 30% through the end of the year. "We therefore remain constructive on European equities through mid-2027, supported by solid earnings-per-share growth," they write. (josephmichael.stonor@wsj.com)

0608 ET - Palm oil fell during the Asian trade, erasing earlier gains. Concerns over rising stockpiles and a weaker-than-expected export performance highlighted in the latest data from the Malaysian Palm Oil Board may have weighed on sentiment, Kenanga Futures writes in a note. The Bursa Malaysia Derivatives contract for November delivery fell 67 ringgit to 4,818 ringgit a ton. (kimberley.kao@wsj.com)

0512 ET - Norsk Hydro's fourth-quarter Ebitda faces risks from disrupted natural-gas supply and cost uncertainty, J.P. Morgan analysts write. The Iran-U.S. conflict continues to impact the aluminum industry, after Norsk Hydro announced in August that disruptions to natural-gas supply at its Alunorte alumina refinery led to a temporary curtailment. That led management to implement contingency measures including purchasing natural-gas volumes at spot prices. While the impact on third-quarter earnings is material on its own, the bank remains concerned regarding the potential impact if Norsk Hydro needs to secure additional spot liquefied natural gas volumes into the fourth quarter. The bank downgrades Norsk Hydro stock to neutral from overweight and lowers its price target to 97 Norwegian kroner from 116 kroner. Shares fall 2% to 89.14 kroner. (dominic.chopping@wsj.com)

0444 ET - Energean is fairly valued, Berenberg analysts write, keeping a hold rating on the stock but slightly increasing the target price to 780 pence from 765 pence. The oil-and-gas company's first-half performance was solid and exploration efforts in Greece offer potential catalysts in early 2027, they say. However, the lower dividend outlook underwhelmed investors and net debt remains elevated against the company's target, they add. Shares fall 1% to 788.50 pence.(adam.whittaker@wsj.com)

0429 ET - BASF selling down its stake in Harbour Energy removes an overhang from the stock and is positive for the London-listed energy company, Barclays analyst Lydia Rainforth writes. The sale improves the stock's free float and reduces the risk of future large block disposals, she says. A major shareholder selling down its large stake is an important step for Harbour Energy, she adds. The company remains well positioned with a growing exposure to the U.S. as well as to high oil and gas prices, she says. The sale cuts BASF's stake to 16.4% from 24.3%. Harbour's shares fall 3% to 269.4 pence.