Headlines
All gas and power contracts increased this week, with the most prominent gains registered across the day-ahead and shorter-term power and gas contracts. Low wind speeds throughout the week caused wind generation to be below the seasonal norm, increasing the requirement of gas-powered generation, bolstering demand for gas. Another bullish influence on gas prices was the decrease in temperatures across the UK and northwest Europe, increasing gas-for-heating demand. Moreover, on 22 October, Equinor’s Sleiper B platform had an emergency shutdown, dropping output by 5.1mcm per day however, Equinor says it will still be able to meet its supply obligation. As a result, day-ahead gas rose 13.1% to 108.50p/th, the highest level since December 2023. November 24 gas was up 12.4% at 110.15p/th, and December 24 gas increased 11.5% to 111.48p/th. All seasonal gas contracts boosted last week, up by 5.8% on average, while both summer 25 and winter 25 gas increased 9.0% and 7.1% respectively, lifting to 101.00p/th and 106.60p/th. Power prices followed the gas market higher, with day-ahead power rising 48.9% to £97.50/MWh, driven by low wind generation in parallel with outages across GB nuclear generation assets. As a result, day-ahead power prices reached the highest level seen since December 2023, at £100.39/MWh on 24 October. Likewise, all seasonal power contracts registered gains, up on average by 4.4%, as summer 25 and winter 25 expanded 6.8% and 4.5% respectively, rising to £78.50/MWh and £87.25/MWh.
Baseload electricity
Forward curve comparison
- Day-ahead power rose 48.9% to £97.5/MWh, due to wind generation being below forecasts across the week. Moreover, lower nuclear output due to Sizewell B being offline for maintenance tightened system margins.
- November 24 power climbed 13.2% at £96.75/MWh and December 24 power increased 9.8% to £91.50/MWh.
Annual October contract
- Q125 power moved 8.3% higher to £95.75/MWh.
- The annual April 25 contract rose 5.6% to £82.88/MWh, 18.7% lower than the same time last year (£102.00/MWh).
Peak electricity
Forward curve comparison
- Day-ahead peak power was up 33.4% to £116.75/MWh, following its baseload counterpart higher.
- November 24 peak power gained 9.7% at £110.25/MWh, and December 24 peak power increased 8.4% to £106.75/MWh.
Annual October contract
- The annual April 25 peak power rose 4.3% to £85.67/MWh.
- This is 16.1% lower than the same time last year (102.05/MWh).
Seasonal power prices
Seasonal baseload power contracts
- All seasonal power contracts saw increases across the reporting period, up on average by 4.4%.
- Summer 25 and winter 25 expanded 6.8% and 4.5% respectively, rising to £78.50/MWh and £87.25/MWh.
Seasonal peak power curve
- All Seasonal peak power contracts boosted last week, up 4.1% on average.
- Summer 25 and winter 25 peak power increased 6.0% and 4.9% respectively, falling to £83.75/MWh and £100.75/MWh.
Commodity price movements
Oil and coal
- During the reporting period, Brent crude oil registered gains, up 0.3% to average $74.80/bl, contrary to the bearish movements seen last week. This highlights the ongoing volatility amid competing market fundamentals.
- At the start of the week, price gains were supported by rising tensions in the Middle East, with this increase also being supported by uncertainty over the upcoming US election which could impact oil and geopolitical policies.
- However, prices found a bearish influence due to reports that the US and Israel will attempt to restart talks on a potential ceasefire in Gaza.
- Market forecasts state that oil prices are expected to average £76.00/bl in 2025 due to sufficient global spare capacity. It was noted though that geopolitical risks from the Middle East conflict could lead to sudden increases in oil prices at any time.
- Further market forecasts note that China’s stimulus policies are believed to be mostly ineffective at increasing oil demand, with concerns around the Middle East conflict and the US election also providing further uncertainty around prices.
Carbon (UK and EU ETS)
- Like many other global commodity markets, carbon prices continue to respond sensitively to wider geopolitical uncertainty surrounding the gas markets, rising 1.0% and 2.8% to €64.54/t and £39.96/t respectively.
- For the UK more specifically, higher prices were the result of reduced wind generation across the reporting period, and below-average temperatures increasing gas-for-heating demand.
- European carbon prices also found support from reduced renewable generation across the continent, however higher coal prices reduced the economic incentive to generate using coal-fired stations.
- UK carbon prices are anticipated to remain similar to current levels across 2025, with market sentiment maintaining a broadly bearish outlook following oversupply, delayed policy reforms, and wider challenges surrounding the view of reconnecting the UK ETS with the EU ETS.
- In shorter timeframes however, prices are anticipated to increase in the week ahead, driven by a reduced wind generation outlook, in tandem with colder weather across the UK in the latter-half of the week.
Wholesale price snapshot – Friday-on Friday
