Further price drops amid healthly LNG supply

Friday’s session brought the continuation of further price reductions, with contracts across the curve posting small losses for the fifth consecutive day.

The Winter-26 contract broke below 75p/therm on Friday, closing at the lowest level of any front-winter contract since 8th June 2021, as the market has seemingly broken out of the narrow range established over the past few months and is now eyeing several year lows.

A steady stream of LNG arrivals is applying sustained pressure to the near-curve as well as reliable Norwegian pipeline flows.

On the storage front, while around 10% lower than the same date last year, overall EU stocks were just below 76% on Saturday 29th, offering the region a more than adequate safety buffer over the rest of the winter supply season.

A significant uptick in wind power generation across Thursday and Friday served as a price ceiling for baseload power prices, but it was not enough to counterbalance increases in the European carbon market.

The baseload power curve posted small, incremental moves in both directions- though a slight bullish bias was observed with the majority of curve contracts lifting into the close.

The Carbon EUA benchmark contract, a key pricing component for fossil fuel generation, rose to €83.26/tonne, just south of the yearly high of €83.93 posted on January 31st (data from ICE).

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Price commentary courtesy of Crown Gas and Power