Energy Market Update - 14 August 2025
Energy markets were broadly steady yesterday, with gas prices holding within a narrow range and power markets showing limited changes. Stable fundamentals were offset by anticipation of tomorrow’s high-profile US-Russia meeting, which has kept traders cautious.
Natural gas prices rose modestly during the previous session, supported by lower-than-normal wind generation across Europe, which lifted gas-for-power demand. The UK NBP day-ahead contract closed at 80.32p/therm, up 1.51%, while the Dutch TTF day-ahead gained 2.41% to €81.57/MWh. German spot prices hit €105.06/MWh, their highest since early July, with similar spikes in Denmark’s DK1 (€104.99/MWh) and Norway’s NO2 (€91.28/MWh). These increases were underpinned by wind load factors of just 5% in Germany, 11% in Denmark, and 12% in Norway. On the supply side, Norwegian pipeline flows to the UK improved, with Langeled deliveries reaching 65.9 mcm/day, up 6.8 mcm from the previous day. However, LNG sendout was subdued at 9 mcm/day, with South Hook nominating 5 mcm/day and Dragon falling to 2.4 mcm/day. European gas storage remains strong, with UK levels at 79% and France at 82%, but Italy lower at 45%. LNG imports to Northwest Europe remain healthy, with multiple US cargoes due this week, alongside shipments from Algeria, Nigeria, and Norway.
UK power prices were slightly softer. The day-ahead baseload contract settled at £89.83/MWh, down £0.17, while November delivery gained £1.07 to £84.95/MWh. The front-season Winter-25 contract stood at £83.13/MWh. Low renewable output has kept gas-fired CCGT generation elevated, averaging over 12 GW in recent days. Wind generation is forecast to remain below seasonal norms until early next week, with gradual improvement expected thereafter. Nuclear output should rise over the coming fortnight, with an additional 2 GW projected from British units. Cross-border power flows were constrained by reduced UK-Norway interconnector capacity, currently limited to 0.7 GW until 11 March before partial restoration.
In other commodities, Brent crude eased to $65.63/bbl, down 0.74% on the day, amid ongoing uncertainty ahead of geopolitical talks. Coal prices (ARA CIF Cal-26) edged lower to $106.85/tonne. European carbon allowances (EUA Dec-25) fell to €71.74/tonne, reflecting weaker industrial demand and expectations of mild weather. The JKM Asian LNG benchmark for September settled at $11.62/MMBtu, down 0.48%, as fundamentals in Asia remained stable.