Energy Market Report - 03 June 2026
Wholesale energy prices eased at Tuesday's close as milder weather and a surge in expected wind loosened the near-term supply balance across gas and power. An underlying geopolitical risk premium tied to Middle East tensions nonetheless kept deferred gas and power contracts well above the levels seen before the conflict, and crude firmed as Gulf tensions escalated.
Natural Gas
UK and continental gas prices fell on Tuesday, led by the prompt as a more balanced weather outlook and a projected jump in north-west European wind reduced the call on gas for power. NBP day-ahead settled at 115.70 p/therm and the front-month at 114.79 p/therm, while TTF day-ahead eased around 3 per cent to roughly €47/MWh; the front of the curve followed, though the Winter-26 contract held above 117 p/therm on the persistent supply-risk premium. The physical picture is comfortable, with total Norwegian exit nominations around 295 mcm/day, UK-bound flows firmer on stronger Langeled deliveries despite an unplanned Oseberg outage of roughly 18 mcm/day, LNG send-out steady near 8 mcm/day, and an arrivals schedule into north-west Europe that is heavy and predominantly US-sourced. European storage continues to rebuild through the injection season, with the latest policy review keeping the focus on refilling ahead of winter. Prices have since firmed in early trade as Gulf tensions intensified and near-term forecasts turned cooler.
Electricity
UK power tracked gas lower on Tuesday, with the curve giving up slightly less than NBP. Day-ahead baseload settled at £96.99/MWh and day-ahead peak at £88.11/MWh, while front-month baseload eased to £101.13/MWh and Winter-26 to £102.09/MWh. The softer tone reflected weaker prompt gas, a more balanced weather outlook and the prospect of a sharp rise in wind, with German and UK output set to climb by roughly two-thirds and four-fifths towards around 15.9 GW and 10.4 GW; wind has been running near 21 per cent of the mix against gas at about a third. Working against that, the UK nuclear fleet remains heavily constrained, with reactors at Heysham, Torness, Sizewell B and Hartlepool offline and availability close to half of last year's level, sustaining reliance on gas-fired generation and lending support to forward seasons. The expected return of Torness Reactor 1 around 17 June should ease some pressure, while continued power imports via the French and Norwegian interconnectors are helping cover demand.
Other Commodities
Brent crude firmed about 1 per cent to $96.00/bbl and WTI to near $93.76/bbl as the Gulf escalation added risk premium, though both remain softer over the week and physical markets still point to ample supply. Coal slipped around 2 per cent, with ARA CIF Cal-27 at $124.19/tonne. In carbon, EUAs edged up to about €79.50/tonne while UK allowances rose more firmly, up over 2 per cent to £57.12/tonne, narrowing the UK discount to the EU scheme. Among global gas benchmarks, Asian JKM eased to around $17.9/MMBtu and US Henry Hub to near $3.0/MMBtu, leaving the Asian premium intact but demand moderate; sterling was little changed against the euro and the dollar.