Gas Market
The NBP market remains rangebound with limited drivers influencing price direction. Curve
contracts drifted sideways, recovering some premium after Monday’s losses. The front-month,
October, rose by less than 1% to settle at 79.30p/th, while the front-winter contract, expiring in
under two weeks, gained 0.67p settling at 85.99p/th. European storage levels stand at 80.83%, and
at the current pace, inventories are projected to reach approximately 90% by end-October, offering
the market reassurance ahead of winter. On the prompt, prices remain muted despite supply-side
factors, including partial restrictions—escalating to a full shutdown on the 23rd September—at the
Dragon LNG terminal, alongside ongoing North Sea maintenance.
Power Market
GB baseload contracts posted minor gains on Tuesday, largely supported by movements in the NBP
gas market, though overall prices remain rangebound. Further out the curve, strength in the UKA
carbon market continues to lend support, with both Dec-25 and Dec-26 contracts recording day-on-
day gains. On the prompt, prices surged sharply, rising 250% from £28.90/MWh to £78.50/MWh,
driven by forecasts of a fall in wind generation.
Carbon prices extended gains, with the spot reaching €77.00/tonne and the Dec-25 contract closing
at €77.49/tonne. These levels were last seen in February 2025, when gas prices traded around 85%
higher, underlining the current disconnect between carbon and the broader energy complex.
Oil Market
Oil futures extended gains on Tuesday, lifted by escalating risks to Russian supply following fresh
Ukrainian drone strikes on export terminals and refineries. The front-month Brent contract settled at
$68.47/bbl, up $1.03 or 1.2%, while WTI rose $1.22 to $64.52/bbl. Prices briefly rose higher in early
trading after the Russian oil pipeline operator, Transneft, cautioned producers that output cuts may
be necessary, but gains moderated as traders weighed the Federal Reserve’s pending policy decision
amid expected interest rate cuts. The attacks by Ukraine have removed some 300,000 bpd of
refining capacity offline this month, according to Goldman Sachs. Despite this sentiment was
tempered by broader macro concerns, as investors awaited signals from the Fed on interest rates
and their implications for fuel demand.
Markets this morning
NBP gas is trading higher this morning, though prices remain within 4–5% of recent 18-month lows.
Norwegian North Sea maintenance continues, with capacity on the Langeled pipeline reduced by 21
mcm/day, though this work is expected to conclude tomorrow. Following yesterday’s gains, EUA
prices are holding broadly flat in early trading. In oil, prices have eased from last night’s close as the
market awaits an expected U.S. Federal Reserve interest rate cut later today, although downside
remains capped by ongoing geopolitical tensions.
17 September 2025
