Gas Market
NBP gas prices edged lower on Monday as optimism around progress in Russia–Ukraine peace talks weighed on sentiment, offsetting stronger demand from colder weather and weaker wind output. Speaking after talks in Berlin, German Chancellor Friedrich Merz said the U.S. had agreed to provide “substantial legal and material security guarantees from the USA and Europeans” to secure a ceasefire, while Ukraine offered to drop its aspirations to join the NATO military alliance. The comments reinforced expectations of a potential easing of Russian sanctions and return of supply. The front-month NBP contract fell 0.32p to 72.92p/therm, with Summer-26 settling 0.74p lower at 64.48p/therm. Prompt prices were more resilient, supported by lower wind generation and gas-for-power demand rising 19mcm/d to 69mcm/d, lifting the day-ahead contract by 0.75p to 71.60p/therm.
Power Market
GB baseload power futures had a mixed session, with weaker gas prices weighing on the curve while firmer carbon prices provided support. The front month fell 30p to £81.53/MWh, while contracts further along the curve were largely unmoved. The day-ahead contract rose sharply, up £11 or 14.6% to £86.50/MWh, driven by lower wind output expected on Tuesday and downward revisions to wind forecasts over the next two weeks.
In carbon, the Dec-25 EUA contract expired at €85.07/t, around 35% above the Dec-24 expiry, after prices hit a fresh year-to-date high and broke above €85 for the first time in 2025. The rally was supported by strong auction results, short-covering ahead of expiry, and expectations of a three-week auction pause. The Dec-25 UKA contract also expired significantly higher, settling at £57.40/t, around 71% above last year’s benchmark.
Oil Market
Oil prices fell on Monday as markets weighed supply disruptions linked to escalating U.S.–Venezuela tensions against growing concerns over oversupply and the potential for a Russia–Ukraine peace deal. Front-month Brent settled down 56 cents, or 0.9%, at $60.56/bbl, its lowest level since February 2021. Venezuelan exports have slumped after the U.S. seized a tanker last week and imposed fresh sanctions on vessels and shipping firms trading with the country. Exports averaged around 952,000 b/d in November but have since fallen close to a standstill. Despite this, market attention remains firmly on Ukraine peace negotiations, after President Zelenskiy signalled a willingness to drop NATO membership ambitions, raising the prospect of increased Russian supply if sanctions ease. Expectations of a future surplus were reinforced by weaker Chinese economic data, with factory output slowing to a 15-month low in November and retail sales growth at its weakest since late 2022.
Markets this morning
Energy markets are softer this morning, led by declines in gas and oil, while carbon continues to outperform. NBP gas prices have moved lower, with the front month down 1.33p at 71.59p/therm and Summer-26 last trading 1.10p lower at 63.38p/therm. Rising wind output, stronger Norwegian flows, and higher LNG send-out have loosened system balances, while ongoing optimism around Russia–Ukraine peace talks continues to weigh on prices. Oil prices extended losses into Tuesday as prospects for a peace deal appeared to strengthen, raising expectations of a potential easing of sanctions. Front-month Brent is down 94c this morning at $59.62/bbl. Carbon remains the outlier across the energy complex, with the new benchmark Dec-26 EUA contract up 17c at €87.45/t.
16 December 2025
