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

1047 ET - U.S. natural gas inventories rose more than expected last week, while the increase was small enough to reduce the storage surplus over the five-year average. Underground storage rose by 40 billion cubic feet to 3,254 Bcf, or 148 Bcf more than the 2021-2025 average, the EIA says. The storage injection was larger than the 28 Bcf estimate in a WSJ survey of analysts, but smaller than the five-year average 52 Bcf build for the week. Nymex natural gas futures are off 1.6% at $2.777/mmBtu. (anthony.harrup@wsj.com)

1038 ET - European energy producers and insurance companies are likely to benefit due to the elevated energy prices and the European Central Bank decision to increase interest rates, eToro's Lale Akoner says in a note. The ECB raised the deposit rate to 2.5% during Thursday's policy decision, as markets expected. Sectors that could be negatively affected by the rate increase include property, housebuilders, smaller companies, and retailers, she says. "Banks may benefit initially from wider lending margins, but that advantage will fade if loan demand weakens and defaults rise." (miriam.mukuru@wsj.com)

1022 ET - U.S. natural gas futures are lower for a third straight session as the market awaits inventory data from the EIA while focusing on coming mild weather. "A third failed attempt at $3.00/mmBtu has recast momentum steeply lower," Eli Rubin of EBW Analytics says in a note. A widening year-over-year storage deficit could provide near-term support for prices, although a key driver of weakness remains the winter strip with robust end of season storage, increasing production and prospects of a mild winter weighing, he adds. Nymex natural gas is off 1.6% at $2.776/mmBtu. (anthony.harrup@wsj.com)

1018 ET - The El Niño system that's in place now is getting stronger, enough so that the NOAA's Climate Prediction Center now views there to be a "greater than 90% chance of a very strong event" in the Northern Hemisphere this fall into this winter. The Climate Prediction Center classifies an event as 'very strong' if the average sea surface temperature deviates more than 3 degrees Celsius higher. An El Niño climate system tends to create mild winters for the northern U.S., while the southern U.S. gets hit with hurricanes potentially exacerbated by the warmer waters. (kirk.maltais@wsj.com)

1010 ET - Grain futures trading at multi-year highs this year prompted hopes for farmers who have suffered from past low commodity prices and inflated input costs for fertilizer and seeds. But surging fuel prices from wars overseas threaten to evaporate any benefit from those higher crop prices. According to AAA, current retail diesel prices set a new high, at $5.9773 a gallon. For farmers, this means harvesting may prove to be an even-steeper expense than anticipated. Last week, the USDA forecast 2026 net farm income at $158.4 billion--up from its previous forecast of $153.4 billion. (kirk.maltais@wsj.com)

0958 ET - Oil futures are sharply higher with WTI hitting $100 a barrel for the first time since May amid increased military strikes between the U.S. and Iran and Houthi advances toward the Bab el-Mandeb strait. "The move is raising fresh concerns about the security of global energy supplies," Fawad Razaqzada of Forex.com says in a note. "A sustained move above $100 in WTI would put renewed upward pressure on inflation expectations." WTI is up 4.1% at $99.95 a barrel and Brent is 3.8% higher at $105.10 a barrel. (anthony.harrup@wsj.com)

0954 ET - Gold and silver futures are lower in the wake of the report showing U.S. producer prices accelerating in August. The decline in precious metals comes amid a rise in yields to at least three-year highs, Peter Cardillo of Spartan Capital says in a note. Both metals have held the lower limits of their recent pullbacks, he adds. "This is a positive sign and suggests that yields may become less of a negative factor for precious metals going forward." Gold for December delivery is off 1.1% in New York at $4,411.70 a troy ounce. Silver falls 5.1% to $65.115 a troy ounce.(anthony.harrup@wsj.com)

0926 ET - Kongsberg Gruppen is becoming a full-spectrum missile-led defense prime contractor, with favorable geographic diversification, Deutsche Bank analyst Sriram Krishnan writes. Rapid capacity expansion and an all-time-high backlog could help the company become one of Europe's fastest-growing and most profitable defense companies, Krishnan says. Meanwhile, margin upside remains relative to conservative management targets, he adds. The bank says the missile business should see around 40% compound annual growth to 2030 to become the group's largest business. This is complemented by 30% compound annual growth for high-margin air defense and remote weapon stations, and 12% growth for the high-tech underwater and space businesses. The bank initiates coverage of the stock with a buy rating and target price of 360 Norwegian kroner. Shares rise 2.5% to 306.80 kroner. (dominic.chopping@wsj.com)

0923 ET - A further hike of the European Central Bank's deposit rate to 2.75% during one of the year's final two meetings is "entirely realistic", Eurizon's Massimo Spadotto writes. As things stand, one more hike should likely be considered the base-case scenario, even though it is by no means certain, he adds. "This remains heavily dependent on the trajectory of commodity prices, which are naturally influenced by developments in the [Middle East] conflict," the head of fixed income says. "However, markets have already fully priced in two additional rate hikes for this year; consequently, these moves should not weigh on the market per se but could instead potentially trigger a 'sell the rumor, buy the fact' dynamic," he says. The ECB raised its key policy rates by 25 basis points, bringing the deposit rate to 2.50%. (emese.bartha@wsj.com)

0913 ET - After raising its key rate to 2.5%, hiking rates further would mean that the European Central Bank sees restrictive monetary policy as necessary, ING's Carsten Brzeski says in a note. The economy has proved resilient this year, but that is different from an overheating economy that needs restrictive policy, he says. "We still find it hard to see--amid public finance woes and surging bond yields--that the ECB would really be willing to add more fuel to the fire," Brzeski notes. The bank isn't likely to be willing to risk a recession to tackle what is still a supply-side shock, but the ECB has made policy mistakes before, he says.(edward.frankl@wsj.com)

0914 ET - Shares in London mining stocks are down in afternoon trade as Brent crude tops $105 a barrel and hostilities between the U.S. and Iran escalate. Higher oil prices will add costs to energy intensive miners who are some of the worlds largest consumers of diesel. Higher oil prices also raise the prospect of interest rate rises to combat inflation. This would hurt investment and consumer sentiment, and drag on demand for mined minerals and metals. Anglo American falls 5.4% while BHP's London shares are down 4.7%. Rio Tinto's slip 3.25%. Glencore slides 3.4% while copper miner Antofagasta falls 6%. (adam.whittaker@wsj.com)

0906 ET - European energy stocks trade higher in afternoon trade as oil ticks above $105 a barrel. Brent crude trades 4.5% higher at $105.80 a barrel while WTI tops $100 a barrel after rising nearly 5%. The rally comes as traders assessed escalating attacks on Gulf shipping and renewed Houthi strikes on Saudi Arabia. In London, BP gains 2.5% and Shell rises 2%. Norway's Equinor is up 2.4%. Spain's Repsol, France's TotalEnergies and Italy's Eni all rise over 1%.