The NBP experienced choppy trade activity on Wednesday, with prices spending much of the session above their previous close before tapering off in the afternoon.

Gas Market

The NBP experienced choppy trade activity on Wednesday, with prices spending much of the session above their previous close before tapering off in the afternoon. An uncertain supply outlook for the coming months as well as simmering geopolitics drove volatility on the day. Muted competition for LNG from Asian markets amid high Japanese stocks and milder weather in the region however mitigated the upside. British LNG supply and the arrival schedule remains robust, with 8 cargoes set to arrive within the next 10 days. After reaching an intra-day high of 120.88p per therm, February-25 went on to close at 118.45p per therm, down 0.17p day-on-day. Slightly lower gas-for-power demand due to increased wind and solar production offset the impact of lower temperatures with Day ahead falling by 0.85p day-on-day. The GB system was well supplied throughout the day which also weighed on the Spot market.

Power Market

After initially tracking the gains experienced on the NBP on Wednesday morning, the GB Baseload front two months failed to follow the afternoon’s downward trend. The February-25 contract increased by £1.22/MWh to settle at £98.48/MWh. Further out, Q2-25 fell by £0.88/MWh day-on-day to close at £86.88/MWh. Low wind output forecast for the rest of the current week as well as cooler temperatures lifted the Weekend and front week contracts. 2025 European carbon allowances rose to their highest level in just over a year on Wednesday, driven by reports of Russian attacks on Ukrainian energy infrastructure as well as data that showed investment funds now hold their largest long position in EUA’s in more than 3 years.  

Oil Market

Crude oil prices continued to be supported by concerns over potential supply disruptions from U.S. sanctions on Russian energy companies and tankers carrying Russian oil. The worries were stoked by the release of the International Energy Agency’s (IEA) monthly report which stated that these latest rounds of sanctions against Russia could significantly disrupt the country’s oil supply chains, potentially tightening the global oil market. A large draw in U.S. crude stockpiles added further upside. The front month Brent contract closed at a fresh 5-month high, posting a 2.6% day-on-day increase to settle at $82.03 a barrel. WTI for February delivery showed similar strength, increasing to $80.04 a barrel at the end the session, a gain of $2.54 on the previous close.   Markets this morning The NBP curve has continued yesterday afternoon’s downward movement, with the front month contract last going through at a 2.04p per therm discount to its previous close. Temperatures are set to fall over the coming days, although lower gas-for-power demand due to improved wind and solar output should mitigate the upside. News of the ceasefire between Israel and Hamas agreed yesterday evening, due to come into effect from January 19th, is also feeding into the downside today. Crude oil prices are steady this morning after settling yesterday at 5-month highs. Front month Brent last went through at $81.92 a barrel, down 11 cents day-on-day.