Energy Market Update - 10 March 2025
Energy markets saw mixed movements on Monday, with gas prices stabilising amid ongoing geopolitical tensions. UK power prices edged higher, supported by colder temperatures and reduced wind generation. Oil prices softened due to concerns over US tariff policies and OPEC+ production adjustments.
European gas markets saw a retracement of last week’s losses, with the TTF Front Month contract settling at €39.97/MWh, up from €38.24/MWh. The UK NBP Front Month contract closed at 97.70p/therm, rising from 93.03p/therm. This rebound was driven by reports of further Russian attacks on Ukrainian energy infrastructure, heightening concerns over European supply security. Over the weekend, Russian forces launched an offensive using an unused gas pipeline near Sudzha on the Russian border, adding to geopolitical uncertainty. European gas storage levels stood at 36.80%, with LNG deliveries to the UK set to total seven cargoes in the coming weeks, slightly down from nine previously expected. Norwegian gas flows to the UK were stable at 329mcm/day.
UK power prices moved higher, with the Front Month Baseload contract settling at £81/MWh, up from £78/MWh. The Front Season contract remained at £77/MWh. Cold weather forecasts, with temperatures expected to drop 2-3°C below seasonal norms, supported short-term power demand. Wind generation is projected to remain below average across much of Europe, further increasing reliance on gas-fired power generation. In contrast, France’s nuclear output remains stable, helping to mitigate some of the supply pressures in continental Europe.
In broader commodities, Brent crude eased to $70.36/bbl from $69.46/bbl as concerns over US economic policies weighed on market sentiment. OPEC+’s decision to lift production cuts in April added to the bearish outlook. European carbon prices edged up, with EUA December 2025 contracts trading at €68.63, up from €67.32. Coal prices also firmed, with the ARA CIF contract for 2026 settling at $102.27/tonne.
Market participants remain focused on geopolitical developments, upcoming peace talks in Saudi Arabia, and shifting weather patterns as key drivers of near-term price movements.