Energy Market Update: Wholesale Gas and Power (20th January 2025)
- Lee Guttridge
- Jan 21
- 2 min read
As we start the new year, the wholesale gas and power markets remain dynamic, with global developments and regional trends influencing energy pricing and procurement strategies. Here’s a breakdown of the latest drivers and what they mean for businesses.
Energy Market Update: Wholesale Gas Market Update
The UK gas market is currently shaped by a balance of bearish and bullish factors:
Bearish Trends
Strong LNG Supply: Robust LNG supplies continue to meet European demand. Weak Asian demand has led to diverted cargoes from Asia to Europe, making Europe the preferred destination due to its market premium.
Middle Eastern Stability: A ceasefire between Israel and Hamas has eased concerns of a broader conflict, reducing geopolitical risks that could have disrupted global LNG supply chains.
Bullish Trends
Sanctions on Russian LNG: The US has expanded sanctions on Russian LNG facilities, further restricting Russian energy exports and tightening global LNG supply.
Pipeline Risks: A confirmed attack on the Turk Stream pipeline has increased concerns about infrastructure security, particularly in regions affected by geopolitical tensions.
Energy Market Update: Wholesale Power Market Update
The UK power market also reflects a mix of bearish and bullish signals:
Bearish Trends
Improved Connectivity: The Green link interconnector, a 550MW link between Ireland and Great Britain, is set to be fully operational in early 2025, enhancing power import capacity and grid reliability.
Renewable Expansion: NESO’s reform of grid operations and a surplus of renewable projects in the pipeline signal continued growth in the UK’s renewable energy capacity, supporting the nation’s clean energy transition.
Bullish Trends
Infrastructure Sabotage Risks: Rising concerns about sabotage to critical energy infrastructure, including sub-sea interconnector cables, highlight potential vulnerabilities.
Skills Shortage in Clean Energy: The rapid expansion of renewable projects could face challenges due to a shortage of skilled workers, posing risks to the UK’s Clean Power 2030 plan.
Implications for Businesses
These energy market update developments highlight the need for businesses to adopt flexible and proactive energy strategies. The current surplus of LNG and strong power import prospects provide opportunities to secure competitive energy prices. However, infrastructure risks and potential skills shortages could lead to volatility in the longer term, emphasising the importance of robust energy planning.
National Business Energy: Your Partner in Energy Solutions
At National Business Energy, we’re committed to helping businesses navigate the complexities of the energy market. Whether you’re looking to optimise procurement strategies, explore renewable options, or safeguard against market volatility, we’re here to support your goals.
Visit National Business Energy to discover how we can help your business thrive in an ever-changing energy landscape. Together, we can build a sustainable and cost-effective energy future.
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