Energy Market Update - 18 December 2025
Markets held a tight range. Cooler late December forecasts and firmer carbon added a mild premium, while strong Norwegian flows and steady LNG kept gas and power balances comfortable.
Natural gas was little changed on the day. Front month TTF traded near €27.6/MWh and NBP Jan 26 around 73p/therm, with the UK system supported by firm Langeled receipts and stable domestic output. Continental nominations were broadly steady and LNG schedules into North West Europe remained active, leaving storage draw rates manageable. Weather models point to a brief turn 3 to 4 degrees below normal after Christmas, with weaker wind expected at the same time, which could lift gas-for-power demand. Henry Hub edged higher on stronger winter export pulls, but the Atlantic supply picture remains ample and continues to cap rallies.
Power tracked gas but stayed range bound. UK baseload for January traded around £82/MWh, with Q1 near £77/MWh, while the prompt eased when wind recovered into evening blocks. French nuclear output is healthy and interconnectors continue to provide margin cover, limiting upside when renewables dip. Forecasts show high wind through today, a dip into the weekend, then a soft patch around the holiday period. That pattern points to choppy day-ahead prices, with any low-wind hours quickly pulling CCGT into merit.
Other commodities offered a mixed signal. Brent hovered just below $60/bbl and WTI around $56/bbl as ample supply tempered geopolitical risk. Coal Cal 26 sat close to $97/t. Carbon remained supportive for the curve, with EUAs near €87/t and UKAs around the low £70s, keeping thermal costs elevated even as gas fundamentals look comfortable. Overall, the immediate set-up is benign, with weather and wind the main swing factors and carbon providing the floor.