There was some upturn for power prices as we ended 2023, although gas continued its downtrend. Power was undoubtedly pushed up by some recovery in the carbon market, as well as cooler continental temperatures and a bit more bad news on French nuclear maintenance. Short-term in the UK was far more bearish than Annuals, based on very strong renewable output (more named storms than the last three winters have pushed wind generation) and the expected demand downturn of Christmas week. Late December also saw the opening of a new UK-Demark power interconnector, predominantly designed to bring wind generation to the UK (as Denmark has high generation relative to population so much lower demand than the UK), which also helps to de-risk the market.

Gas remains weak, although there have been some concerns about LNG shipments following the terrorist attacks in the Red Sea. Overall, the well maintained storages levels across the EU give great comfort in terms of pricing.  

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