Energy Market Update - 23 January 2026
European gas prices fell back as fears of major US LNG disruption eased and forecasts shifted towards near-seasonal temperatures across north-west Europe. UK power curves softened in step with gas, while carbon firmed and oil recovered late on renewed Iran-related tension.
UK gas pulled back sharply, with NBP day-ahead settling at 99.20p/therm, down 5.80p/therm, as TTF also tracked lower. The key change in sentiment was a growing view that the US cold snap may cause only limited LNG export disruption, with terminals able to use inventory to maintain loadings, prompting traders to unwind some of the risk premium built into prompt prices. The UK system opened 24mcm/day long. Norwegian exit nominations were broadly steady at 335.3mcm/day, although Vesterled flows were cut to 5mcm/day. Higher LNG send-out helped compensate, revised up to 93mcm/day (mainly via South Hook). EU storage was reported around 48.8%, with withdrawals ongoing but seen as manageable under the revised weather outlook. Further out, the curve eased too: Summer 26 fell to 74.50p/therm (down 1.10p) and Winter 26 to 76.75p/therm (down 1.00p), as peak demand expectations softened across successive model runs and Atlantic LNG optionality continued to cap upside unless colder weather or a genuine supply disruption emerges.
UK power followed the move lower on the curve. Summer 26 baseload settled at £76.00/MWh (down £1.05) and Winter 26 at £80.95/MWh (down £0.70). The prompt market diverged, with day-ahead baseload rising to £97.00/MWh (up £8.58) on firmer demand. Wind generation remained strong, averaging 19.9GW and acting as the largest generation source over the day. Nuclear availability dipped after a partial unplanned issue at Torness, expected to be resolved within the week, while interconnectors continued to support peak supply. Beyond the prompt, carbon strength helped anchor longer-dated prices, and the market remains sensitive to any wind underperformance next week that could quickly tighten near-term balances.
In other markets, Brent slipped to $64.06/bbl (down $1.18) on softer physical signals and ample supply, before recovering some losses late after comments from President Trump about ships near Iran raised fresh concern around potential escalation and supply disruption; flat time spreads continued to signal limited front-end tightness. Carbon markets edged higher, with EUAs up €1.41 to €88.47/tonne and UKAs up £1.33 to £68.76/tonne, reflecting modest position rebuilding after recent weakness, while near-term direction remains tied to residual load and auction rhythm. In the broader backdrop, US gas volatility remained elevated after a historic rally and subsequent pullback, while commentary pointed to Europe potentially importing record LNG volumes this year, reinforcing continued reliance on seaborne supply and the importance of competition with Asia during demand surges.