Energy Market Update - 28 February 2025
Energy markets rebounded sharply in yesterday’s session, reversing prior losses as traders adjusted positions following clarification on EU gas storage targets. Power prices also rose, supported by lower wind generation forecasts and stronger gas prices.
European natural gas markets retraced previous declines after the European Commission reaffirmed the 90% storage target for November, contrary to earlier speculation of a relaxation. This led to a reassessment of near-term demand requirements, pushing prices higher. The TTF Front Month contract closed at €45.15/MWh, up from €41.34/MWh, while the NBP equivalent settled at 107.12p/therm, compared to 98.78p/therm the previous day. Norwegian gas flows remained stable at 325mcm/day, despite unplanned maintenance at the Skarv field, while EU gas storage levels stood at 39.54%, slightly lower than the previous day’s 39.93%. The UK expects 14 LNG cargoes over the next two weeks, ensuring continued strong supply.
UK power prices followed the gas market higher, with the Front Month Baseload contract reaching £91/MWh, up from £87/MWh. The Front Season contract also climbed to £86/MWh from £79/MWh. A downward revision in wind generation forecasts contributed to the bullish sentiment, as weaker renewable output increases reliance on gas-fired generation. The UK Day-Ahead power price rose to £101/MWh, up from £97/MWh. European carbon prices also moved higher, with EUA December 2025 contracts rising to €72.78/tCO₂.
In other commodities, Brent crude edged higher to $74.04/bbl from $73.00/bbl, driven by concerns over potential delays in OPEC+ production increases. Coal prices for 2026 delivery increased slightly to $102.71/tonne. Meanwhile, global LNG prices strengthened, with JKM at $13.99/MMBtu and the TTF equivalent at $13.78/MMBtu, reflecting steady demand in Asia and Europe. US Henry Hub gas prices remained relatively stable at $3.93/MMBtu.
The market remains focused on EU regulatory developments, LNG supply trends, and weather-driven demand fluctuations as we head into March.