Energy Market Report - 02 October 2026
Geopolitics did the pricing on Thursday, with reports of tanker strikes in the Strait of Hormuz lifting forward gas, power and crude even as physical supply into north-west Europe improved. Prompt markets moved the other way, with day-ahead gas and power both settling lower on an oversupplied UK system.
Natural Gas
The forward market rose on risk rather than fundamentals. Maritime agencies reported at least five commercial tankers struck in the Strait of Hormuz during the week, with Iran claiming responsibility for three, and that was enough to add roughly 4p/therm across the near curve despite a supply picture that is steadily improving. NBP Nov-26 settled at 186.53 p/therm and Jan-27 at 189.29 p/therm, while TTF Nov-26 firmed to €73.94/MWh. Day-ahead told a different story, easing 1.50 to 176.50 p/therm as the system ran long and exports to Belgium via IUK widened. Norwegian nominations climbed for a fifth consecutive day to 321.5 mcm/day after Gassco confirmed summer maintenance complete, and have added a sixth increase this morning, although outages at Heidrun, Kristin and Dvalin were extended and Åsgard maintenance now runs to 11 October. What keeps the winter bid intact is storage: EU inventories closed September near 71.5 per cent, well below the same point last year, with the EU ban on Russian LNG from January 2027 now inside the pricing window. Three LNG cargoes are tracked into the UK before mid-October, and sendout at Isle of Grain and South Hook remains subdued.
Electricity
Power fell on the prompt and rose on the curve. A sharp turn in the generation mix saw wind drop from 47.9 per cent of the stack to 25.8 per cent and gas-fired output climb from 23.0 per cent to 40.0 per cent, with gas-for-power up around 6 mcm/day, but the system still carried enough length to push day-ahead baseload down £5.71 to £154.40/MWh and peak down £10.97 to £155.03/MWh. Intraday prices ranged from £63.50/MWh overnight to £225.89/MWh into the evening ramp, with Friday's tightest half hour arriving instead at the morning peak. Forward contracts moved with gas and with the nuclear picture: Jan-27 baseload gained £7.01 to £160.47/MWh and Cal-27 firmed to £118.16/MWh, with three of EDF's eight UK reactors offline, fleet output near 3.9 GW and Heysham 2 Reactor 8 out until late November. France is tighter again, with around 19 GW of nuclear outages expected through October and the French system importing for several hours on Thursday, while German Cal-27 pushed toward €130/MWh. Wind is forecast well below seasonal average across north-west Europe into next week, which should lift thermal requirements.
Other Commodities
Crude led the complex higher, with Brent M+1 settling at $102.31/bbl, up $4.28 or 4.4 per cent, and WTI at $92.87/bbl, after China suspended oil product exports to prioritise domestic supply into a tightening market. Coal was comparatively quiet, API2 ARA Cal-27 adding $0.90 to $137.01 per tonne. Carbon firmed on both schemes, with EUA Dec-26 up €0.55 to €85.64 per tonne and UK ETS Dec-26 up £0.78 to £62.19 per tonne, leaving UK allowances at a discount of roughly €12.80 per tonne to their European equivalent - a gap that has narrowed appreciably over the past week as UKAs outperformed. On global LNG benchmarks, JKM Nov-26 eased to $25.24/MMBtu and Henry Hub Nov-26 fell to $2.97/MMBtu, down almost 12 per cent on the week, keeping the Atlantic arbitrage into Europe open. Sterling slipped half a per cent against the dollar to 1.3199 while holding near flat against the euro at 1.1713, marginally raising the sterling cost of dollar-priced imports.