Energy Market Report - 04 June 2026
UK and European energy markets held a firm tone in Wednesday's session, with gas and power supported on the curve by geopolitical risk and tight European storage even as a surge in wind drove prompt power sharply lower. Crude and coal firmed alongside, while carbon eased modestly but stayed near recent highs.
Natural Gas
Gas prices extended their recent advance, lifted by renewed Middle East tensions, lagging European storage and a cooler turn in temperatures. NBP settled at 118.50 p/therm at the day-ahead on Wednesday, with the front month at 117.90 p/therm and Winter 26 at 119.86 p/therm, and this morning's indicative levels have edged a little higher again. The supply backdrop is reasonably comfortable, with Norwegian flows recovering after an unplanned outage at Oseberg, Gassco exit nominations rising to 305.4 mcm/day and Langeled deliveries to the UK climbing to offset weaker volumes elsewhere, leaving the British system around 13 mcm/day long. The principal concern remains storage, with European sites around 41 per cent full and the slowest injection pace for early June in five years, while UK LNG send-out holds near 9 mcm/day against thin terminal arrivals this month and a JKM premium, at 18.66 $/MMBtu, that continues to draw flexible cargoes towards Asia.
Electricity
Power diverged between prompt and curve. The UK day-ahead baseload settled sharply lower at 67.79 £/MWh, down by about £29, as wind generation surged by roughly 153 per cent day-on-day and cut gas-fired output by around 67 per cent, more than offsetting a 27 per cent drop in solar. The forward curve, by contrast, firmed in step with gas and carbon, with front-month baseload at 103.40 £/MWh and Winter 26 at 103.60 £/MWh. Constrained nuclear availability is a key support, with five of the UK's nine reactors offline at points this month, and carbon near €79 to €80 per tonne lifting the cost of thermal generation. Wind is forecast to remain above seasonal norms and strengthen next week, and demand is expected to ease into summer, which should limit near-dated gains.
Other Commodities
Crude extended its weekly rally on Middle East risk premium, with Brent settling at 97.81 $/bbl and WTI at 96.02 $/bbl, both higher on the day and the week. Coal firmed modestly, with ARA CIF Cal 27 at 126.35 $/tonne. In carbon, EUAs eased to 78.60 €/tonne and the UK ETS to 56.19 £/tonne, leaving the UK allowance discount to the EU benchmark broadly unchanged. Global gas benchmarks showed a firm Asian pull, with JKM at 18.66 $/MMBtu against Henry Hub at 2.97 $/MMBtu, while sterling was steadier against the euro at 1.1578 and a little softer against the dollar at 1.3416.