Energy Market Update – 25 July 2025
Energy markets were steady on Thursday, with gas prices holding in a narrow range due to balanced supply and demand, while UK power was shaped by continued high gas generation. Carbon and oil prices moved slightly, while trade developments influenced sentiment.
UK natural gas prices remained broadly unchanged, with the front-month NBP contract trading at 78.59p/therm. The system appeared balanced, though a one-day extension to Troll maintenance kept Norwegian supply slightly constrained. Despite this, flows into the UK via Langeled rose by 7mcm, helping to partially offset short system forecasts. Domestically, an unplanned outage at Barrow North Terminal removed 6mcm/day due to a technical issue, replacing earlier unavailability at Perenco Dimlington. Storage levels in Britain remain well below average, sitting at 8.4GWh compared with 20.3GWh for the same date last year. On the continent, the German Rehden storage site continues to lag significantly, with filling hindered by weak price spreads. EU gas storage overall remains on track to meet its targets. A notable development involved German regulators investigating suspected manipulation in the THE gas market, where traders may have been exploiting differences between low and high-calorific gas nominations for profit.
UK power prices stayed stable, with contracts moving marginally across the curve. The Q4 2025 baseload contract was last priced at £81.79/MWh, while Winter 2025 settled at £83.56/MWh . Forward prices were supported by the continuing tight correlation between gas and power markets, due to persistently high CCGT generation. Poor renewable output across the week kept gas-fired power demand elevated. A shift in the UK’s Contracts for Difference (CfD) scheme increased strike prices for wind but reduced them for solar, which may alter investment decisions and challenge solar deployment goals. European markets mirrored this flat profile, with little movement across France, Germany, and the Netherlands.
Crude oil prices rose modestly, with Brent at $69.18/bbl and WTI at $66.03/bbl, supported by optimism surrounding a proposed trade agreement between the US and EU. However, a potential increase in oil supply looms after the US signalled it may allow Chevron to resume joint operations with Venezuela’s PDVSA. Carbon markets firmed slightly, with EUAs for December 2025 reaching €70.88/tonne, up €2.19. In contrast, UK ETS prices dipped slightly to £57.98/tonne. Coal prices were mostly unchanged, with the Cal-26 ARA CIF contract at $110/tonne. LNG imports remain healthy, with ten vessels due to arrive at Northwest European terminals by 28 July. US exports continue to dominate, accounting for 95 deliveries over the past year, well ahead of Qatar and Algeria.