A period of milder weather forecasts in the middle of the month provided temporary relief. Prices resumed their upward trajectory after reports suggested that Europe’s gas storage levels could fall to record lows by the end of the season. This concern was amplified by reduced LNG output in the United States, where a cold snap disrupted production. Though, early February saw a significant reversal for both gas and power markets with news of milder weather, increased LNG output, and some easing of geopolitical tensions that alleviated supply concerns.
Increased storage withdrawals over January see EU storage drop to 45% fullness, 11% lower than last year. In addition, a cold snap in the US saw a reduction in LNG output towards the end of January. Only 36 LNG cargos to arrive in Europe this February, compared to 110 received last year. Summer26 contracts are pushed up further to meet the demand to replenish storage. Though this concern was short-lived, as revised forecasts see US LNG output ramp up once again from start of February.
The government has proposed changing the way the Feed-In Tariff (FiT) scheme is indexed to inflation.
They are proposing that FiT tariff rates are to be linked to Consumer Price Index (CPI) rather than Retail Price Index (RPI).
The consultation is ongoing, and once completed, the FiT tariffs for 2026-27 will be published.
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