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Bearish Drivers

· Seasonal Demand Weakness – Cooler weather forecasts and the transition out of peak summer power generation reduce near-term demand.
· Ample Global Supply – Strong LNG flows and record U.S. production keep global markets well-supplied, easing price pressure.
· Import Flexibility – Centrica’s acquisition of the Isle of Grain LNG terminal expands UK import capacity, lowering risk of shortages.
· Structural Demand Decline – UK gas consumption is at a 30-year low and continues to fall as renewables and electrification increase.

Bullish Drivers

· Low UK Storage – UK holds only ~7.5 winter days’ worth of storage, making prices vulnerable to short-term shocks.
· Geopolitical & Policy Risk – Supply security concerns, global trade tensions, and potential shifts in UK energy policy add a risk premium.
· Tax Burden on Domestic Production – The Energy Profits Levy discourages North Sea investment, which could reduce local supply.
· Long-Term Supply Contracts – While deals with Norway and LNG investments secure supply, they highlight reliance on imports and the vulnerability to global market swings.

European spot gas prices have trended modestly lower this month, down about 8% since early August, trading within a narrow €30.5–33.5/MWh range. This reflects muted bullish drivers, firmer LNG supply expectations, and a generally stable fundamental backdrop.

Looking ahead to September to early October, prices are expected to be bearish/soft due to oversupply and weak demand.

For September, we expect a tighter balance in Northwest Europe versus August. Demand is set to rise seasonally by roughly 520 GWh/d, while Norwegian flows will fall by about 300 GWh/d due to heavy maintenance—the most impactful program of the summer. Offsetting this, LNG sendout should increase by 230 GWh/d month-on-month, supported by weaker cooling demand in the Middle East and higher Yamal output post-maintenance. As a result, net storage injections are expected to fall by 600 GWh/d from August, to around 770 GWh/d.

The 1st November storage forecast has improved versus last month and is now expected that NWE storages reaches 86% fullness (up from 84%), reflecting stronger LNG availability and firm cross-border inflows. September–October sendout is expected to benefit from LNG Canada’s technical recovery and the commissioning of its second train in August, enabling higher exports from September onward.

The recent Trump–Putin summit in Alaska (Aug 2025) ended without a ceasefire deal or new sanctions, leaving energy markets in a holding pattern. Trump’s decision to delay sanctions on Russian oil buyers eased fears of supply disruption, pushing oil—and by extension, gas prices lower. UK gas prices had already fallen in anticipation of a softer stance, reflecting market optimism despite no concrete breakthroughs. Longer term, OPEC+ coordination on production and broader geopolitical uncertainty (around Western unity and Russia’s leverage) could still inject volatility into UK gas markets, especially given the UK’s limited storage capacity.

Looking further ahead into Winter 25, the bullish risks grow as low storage and reliance on imports leave the UK exposed to shocks or supply disruptions.

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