Snapshot - 12 January 2026
Gas and power firmed as weather models shifted decisively colder for mid-week, reintroducing a near-term risk premium after last week’s easing. UK prompt power rose around 3 per cent and near-curve gas followed, supported by forecasts showing temperatures falling about 4°C below seasonal norms just as wind output drops back from today’s peak. Carbon remained supportive, with UKAs steady near £68.17/t, while physical supply stayed broadly comfortable, limiting follow-through beyond the front of the curves.
Gas strengthened at the prompt as the market repriced heating demand and higher gas-for-power during the expected cold window. Norwegian flows remain robust at around 337 mcm per day, though the ongoing Vesterled restriction trims flexibility through mid-week. LNG cover is ample, with ten cargoes expected before month-end, but storage at about 55 per cent is materially below last year, increasing sensitivity to short cold snaps and wind underperformance. Further out, summer contracts firmed modestly as the prospect of steeper winter draws brought injection economics into earlier focus.
Power tracked gas higher near term, with week-ahead baseload supported by weaker wind forecasts and tighter evening margins. Interconnector capacity and stable nuclear availability provide some buffer, but reduced renewable output during colder periods is lifting expected thermal runs and balancing costs. Further along the curve, moves were more muted, with carbon strength continuing to anchor forward clean spreads even as fuel volatility remains concentrated at the prompt.
Oil was broadly steady, with geopolitical tension around Iran adding headline risk but little immediate impact given ample supply and flat time spreads. Carbon held near recent highs, supported by strong auction demand and expectations of tighter policy over time, while Asian LNG prices softened further, freeing additional Atlantic cargoes for Europe. Overall, the market remains well supplied, but short-term pricing is again firmly weather-led.
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