Energy Market Update - 29 August 2025
Energy markets fell further yesterday as European gas and power prices eased, weighed down by the first sanctioned Russian LNG delivery to China, strong renewable output, and ample storage levels.
Natural gas markets moved lower across Europe as reports confirmed China had received its first cargo from Russia’s Arctic LNG 2 project. The development raised expectations of additional LNG availability on the global market, offsetting concerns around Russian strikes on Kyiv and a targeted EU delegation building, which otherwise increased geopolitical risk. While Norwegian maintenance continued to limit output, LNG supply and healthy storage levels softened the impact. EU storage is 76.64% full, broadly unchanged, while UK nominations from Norway stood at 255mcm. At the close, the TTF front-month contract settled at €31.71/MWh, down from €32.55, while the UK NBP equivalent dropped to 77.95p/therm from 80.43p. Spot NBP traded at 79p, with no new LNG cargoes expected in the UK in the near term. This morning, the TTF front-month was seen around €32/MWh, €1 lower than yesterday’s settlement.
UK power benchmarks followed gas markets lower. The UK baseload front-month contract closed at £76/MWh, unchanged on the day, while the front-season slipped to £81/MWh from £83. The spot baseload price was steady at £83/MWh. Higher wind generation forecasts, with output expected to climb on Sunday before easing again, contributed to downward pressure on prices. Across Europe, firm renewable generation, particularly wind, also weighed on forward prices. In Germany, the baseload September contract traded at €86.08/MWh, down slightly, while French September power eased to €49.39/MWh. Dutch September contracts also edged lower, reflecting weaker demand and improved renewable contributions.
In other commodity markets, oil and carbon prices were relatively stable. Brent crude was quoted at $69/bbl, little changed from $68 previously, as traders balanced the risk of further US sanctions on Russia against signs of steady global demand. EU carbon allowances (EUA Dec-25) were at €72/tonne, flat on the day, while UK ETS values hovered just below €60/tonne. Coal ARA CIF Cal-26 slipped slightly to $104/t, and US Henry Hub gas futures were at $2.94/MMBtu, up modestly from $2.89. Asian LNG prices were softer, with JKM at $11.21/MMBtu versus $11.31 previously, keeping the TTF equivalent at around $10.87/MMBtu.