Energy Market Update - 08 April 2025
Energy markets moved higher by session end despite a weak open, driven by shifting sentiment around global trade tensions and expectations of a softer stance from several countries in response to US tariff threats.
In the gas market, European benchmarks experienced significant volatility. Initial losses were spurred by China’s decision to match US tariffs with a 34% levy on American goods, amplifying fears of demand destruction. However, a rumour regarding a possible 90-day tariff pause for all countries except China triggered a rebound, only for this to be denied shortly after by the White House, adding to the day’s unpredictability. Meanwhile, the UK NBP front-month contract rose to 90.77p/therm from 88.75p, while the TTF front-month increased slightly to €37.00/MWh from €36.40.
Storage levels in the EU edged up to 34.96% full, while UK system demand grew to 214.47 mcm amid increased flows from Norway through Langeled as outages at Aasta Hansteen and Dvalin persisted. Norwegian flows to the UK reached 313 mcm. Meanwhile, LNG send-out stayed steady with three vessels expected in the UK over the next two weeks.
Power prices in the UK remained relatively flat, with front-month baseload holding at £73/MWh and the front-season slipping slightly to £83 from £84. Wind generation has been below seasonal norms, though forecasts suggest a return to average output levels by the end of next week. The UK’s floating offshore wind programme progressed, with key Welsh ports selected for development.
Nuclear supply concerns resurfaced after the Hartlepool plant was placed under increased regulatory attention due to safety concerns, although operator EDF is exploring an extension of the plant’s life to 2027. Interconnector imports to the UK rose to 4.4GW, the highest in over two weeks.
In broader commodity markets, Brent crude rebounded marginally to $64.21/bbl after dipping to levels not seen since 2021. The move was supported by overtures from various nations to mitigate tariff impacts, though uncertainty remains high. European carbon prices (EUAs) continued to decline, settling at €62.84/tonne from €63.82, as market concerns about reduced industrial demand weighed on sentiment. Coal also saw a small uptick, with the ARA CIF Cal-26 contract rising to $107.68/tonne. In LNG, the JKM price dipped to $12.78/MMBtu, while Henry Hub eased to $3.66/MMBtu. The TTF equivalent price was reported at $11.85/MMBtu, reflecting steady European gas hub pricing.