Brent declined by 19.8% for 2025, the largest one-year decline since 2020

Gas Market

On Wednesday the NBP curve moved higher in the early morning, and those gains were retained through the session. The new front month for the NBP, February, settled 1.75p per therm up at 73.81p in response to the cooler temperatures forecast for the start of the year. Gains to contracts further along the curve diminished with summer-26 settling just over a penny higher while the contract for next winter added 0.75p. The UK Met Office is forecasting snowfall for northern areas, but temperatures are expected to return to normal in the middle of next week. On the prompt, the Spot was just 0.20p higher at the close of play on a shortened trading day for New Year’s Eve, but the weekend product was marked 1.95p higher.  

Power Market

 GB baseload futures tracked the NBP curve higher on New Year’s Eve as temperatures are expected to plunge below the norm. The front month, January, on its final day added £0.63/MWh, however, the February contract was more heavily traded and gained £1.58/MWh to close at £82.33/MWh. Carbon EUAs were little changed on the day with contracts for Dec-2026 and Dec-2027 adding an average of 9 cent per tonne. Robust wind generation is forecast for the start of the year and expected to make up around 50% of supplies in the power stack. Baseload for the Day ahead responded by shedding 13.7% or £11.00/MWh. Wind generation levels heading into the weekend are expected to top 18.0GW.    

Oil Market

Crude oil prices ended the year in decline with Brent easing by 48 cents a barrel to settle at $60.85 on expectations of oversupply. This loss takes the decline for Brent to $15.08 or 19.8% for the year, the largest one-year decline since 2020. There are still concerns from ongoing geopolitical risks with the war in Ukraine continuing despite the attempts to bring about a peace agreement and President Zelensky’s willingness to meet with his opposite number from Moscow. The blockade in Venezuela continues to pose a threat to crude oil exports but there are signs that the Venezuelan government are open to talks to tackle drug trafficking, but will it be enough for Donal Trump to back off.  

Markets this morning

GB gas demand is picking up after the festive break and in response to the cooler temperatures, but supplies are comfortable with a surplus showing on the National Grid’s site.  The Spot price has eased in early trading with the last trade going through at 75.65p per therm. Early gains to the near curve for the NBP have been pared back with February now up 0.77p at 74.58p.  Gains further along the curve are in the range of 0.25p to 0.45p. Crude oil prices are slightly lower having traded above Wednesday’s close earlier after reports of Ukraine’s attacks on Russian refineries overnight.