Energy Market Report – 20 February 2026
Energy prices pulled back on Friday after Thursday's sharp geopolitical rally, with improving wind output and below-seasonal gas demand reasserting bearish fundamentals despite lingering US–Iran tensions in the Gulf.
Natural gas prices softened across the curve as the UK system opened long and wind generation recovered strongly. The NBP front-month contract eased around 2.5% to near 79p/therm, unwinding a portion of Thursday's 6% surge triggered by Iran's closure of Strait of Hormuz shipping lanes and President Trump's warning that Tehran had 10–15 days to agree a new nuclear deal. UK gas demand was revised lower to approximately 238 mcm – some 17% below the seasonal norm – while gas-for-power requirements dropped by 5 mcm/day to 34 mcm/day as wind output climbed back above 15 GW. LNG send-out remained robust at 86 mcm/day across South Hook, Dragon and Isle of Grain, with nine cargoes expected before month-end. Norwegian flows, however, remain a concern: unplanned maintenance at Oseberg has removed 7.7 mcm/day, Langeled deliveries have fallen 7 mcm/day to around 50 mcm/day, and the Ormen Lange outage has been extended to Wednesday 25 February. Further along the curve, Summer-26 gas eased 1.10p/therm to 76.20p/therm and Winter-26 fell 0.75p/therm to 80.60p/therm, with the back end seeing larger drops as traders unwound Thursday's risk premium. European storage stands at 32%, with German sites at just 23% – low for the season but manageable given milder temperatures forecast through next week. TTF March-26 settled at €33.52/MWh.
Power markets tracked gas lower on the prompt. Day-ahead baseload for Monday delivery traded around £69/MWh, supported by wind forecasts averaging above 16 GW over the weekend and 12 GW for Monday itself. This marked a sharp turnaround from Thursday, when a 47% drop in wind output and a 16% decline in solar had forced a 74% surge in CCGT offtake, driving baseload prices higher across the curve. On the forward curve, Summer-26 baseload rose £0.50 to £71.50/MWh and Winter-26 gained £1.25 to £77.25/MWh, reflecting residual geopolitical support and tight nuclear margins. Further out, prices fell, with Summer-27 shedding £0.90 to £62.85/MWh and Summer-28 dropping £1.25 to £59.65/MWh. Nuclear availability remains constrained, with Hartlepool-2 and Heysham 2-7 both out on unplanned trips alongside planned outages at Torness-2 and Heysham 1. Notably, the UK has been a net power exporter to the Netherlands through February via BritNed, shipping approximately 120 MW – a reversal from January's import pattern driven by storm conditions and strong renewable output.
In broader commodities, Brent crude settled at $71.66/bbl on Thursday – its highest in six months – before stabilising around $71 on Friday morning, with the weekly gain of over 6% driven almost entirely by geopolitical risk rather than physical tightness. Coal ARA CIF Cal-27 rose to $113.19/tonne, up 2.81% on the day and 8.38% on the week. Carbon markets moved in the opposite direction: EUA Dec-26 eased €0.23 to €71.34/tonne, while UK ETS Dec-26 fell £1.48 to £46.07/tonne. The UKA sell-off has been notable – down 26% since early February – reflecting weak residual demand, auction pressure and the absence of any near-term policy catalyst to narrow the widening UKA–EUA spread.