In May, power and gas markets strengthened from April, but stable fundamentals saw a relatively flat month despite evolving global geopolitics.
Above-average temperatures across Europe led to subdued gas-for-power demand, further supported by strong solar generation. The market was kept in anticipation as conflict escalated between Russia and Ukraine, along with Trump’s conversations with Putin intensifying, yet little progress was made. Outages at Norwegian gas fields and further threats of US tariffs drove some short-term volatility at the end of the month, though robust wind and solar generation kept markets balanced and allowed continued storage injections across Europe.
Power
Seasonal contracts for baseload power have grown since April’s close; however, throughout May they have remained rangebound.
| Contract
(Baseload power) |
Closing Price, 30th May 2025 (/MWh) | Month Movement |
| Winter 25 | £ 82.89 | +3.8% |
| Summer 26 | £ 70.13 | +4.3% |
Movement over 1 year, W25 and S26
Gas
Low heating demand sees just one LNG cargo due to arrive on UK shores in June. Improved storage levels across Europe ease some concerns for Winter 2025, though are still behind 2024 levels. Storage fullness by Autumn is expected to be a driver for the season ahead contracts, particularly as Asian cooling demand grows and increases competition with Europe for LNG cargoes.
Looking ahead
Strong wind generation and above-average temperatures are to continue into the start of June. The EU Commission continues talks on the future of gas storage targets on 3rd June, outcomes could influence gas markets in the years to come. Concerns over global recession are still present, as the US threatens to impose 50% tariffs on the EU, while currently delayed, the market will remain sensitive to the implementation of tariffs.
The Greenspan Agency produce this report on a best endeavours basis, and it has been supplied for your interest; the facts in this report should not be relied upon for decision making. If you have any queries about the content in this report, please contact bureau@greenspanenergy.com
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