Gas Market
NBP gas contracts continued their downward trajectory in Thursday’s trading, marking a third straight session of losses. The front-month September contract expired at 77.80p/th, hovering close to an 18-month low. Prices remain under pressure from bearish fundamentals, with further weight coming from reports that China has taken delivery of a sizeable LNG cargo from Russia’s Arctic LNG 2 facility, despite the risk of potential U.S. sanctions. This marks the first cargo from Arctic LNG 2 to reach an end-user since the project began operations last year. Analysts note that, should China persist in accepting Russian LNG from the plant, global supply could rise by as much as 3% in 2026. The prospect of additional volumes, combined with Chinese LNG demand continuing to lag year-ago levels, is reinforcing the bearish tone across the market.
Power Market
GB baseload contracts tracked the bearish gas market lower on Thursday. Reports of China accepting a Russian LNG cargo, combined with a weak demand outlook, weighed on sentiment, with the Winter-25 contract falling to £81.50/MWh. Further pressure came from a shift in perspective on European gas storage, with levels now approaching 80% full. Concerns over winter withdrawals are easing and injection rates are beginning to slow. The softer gas backdrop has also pulled the September baseload contract lower, which settled at £75.13/MWh.
EUA carbon allowances continue to trade in a tight range, as the Dec-25 contract was assessed €71.72/tonne, a day on day fall of a mere 0.72%.
Oil Market
Crude oil prices recovered from early losses on Thursday, with Brent settling 57 cents higher at $68.62/bbl and WTI closing at $64.60/bbl. Reports of fresh Russian strikes on Ukraine, followed by retaliatory attacks on two Russian oil refineries, shifted sentiment and provided upward support. The developments also drew political attention, with Trump signalling he was “not happy” with the overnight events, and markets remained poised for further comment from Washington. Earlier in the session, prices had come under pressure as supply concerns dominated, with OPEC+ set to implement a planned 547,000 bpd production increase from Monday. The prospect of additional barrels entering the market weighed on sentiment initially, reinforcing expectations of a looser supply–demand balance in the near term.
Markets This Morning
NBP gas markets have opened lower once again this morning, however the rate of decline appears to have slowed. The Winter-25 contract has yet to trade, although its constituent quarters have traded an average of 0.29p/th lower. The new front month contract, October, has shed 0.32p in early trading as it gets ever closer to posting a fresh 18-month low. Crude oil has reversed much of Thursday’s gains as the market eyes the imminent end to the U.S. driving season and the increase in demand it typically brings. In conjunction with this is the expected increase in global supplies as OPEC+ increase supply from Monday
29 August 2025
