Over the last few days, wholesale gas and electricity prices have broadly dropped, especially in the short term, which means that the curve is now much flatter across 1, 2, and 3 year terms. With continuing silence in the Middle East, we expect further price drops until the current round of diplomatic initiatives is completed, hopefully successfully.

On the generation front, prices have dropped by about £10 per MWh in the last week, as fossil fuels accounted for just 20% of overall generation. At a retail level, we are seeing a softening of prices following the spikes in the early part of last week.

Gas: Prices were mixed yesterday. Some prompt contracts gained in value, whilst further out on the curve, prices fell. Drivers of prompt prices included a rise in demand, likely due to warmer temperatures increasing the need for cooling demand. This morning, early trading is down on last nights close.

Power: Power prices fell in the prompt yesterday, with the wider energy complex having a bearing on price.  Further out on the curve, a fall in benchmark UKA contracts added pressure. Early morning trading today is slow, with varying movements on last nights close.

Carbon (EU ETS): The ICE Dec-25 closed at €68.97/t last night. Opening at €69.03/t this morning, the contract is currently trading at €69.75/t.

Carbon (UKAs): The ICE Dec-25 fell steeply yesterday, closing at £46.08/t. The contract opened higher today at £46.50/t and is currently trading at £46.47/t.

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