Energy Market Report - 18 May 2026
European energy markets opened the week firmly higher, with gas, power and crude all pushed up by an Iranian drone strike on a nuclear facility in the UAE and renewed US pressure on Tehran to reach a deal. Tightening physical fundamentals across Norwegian supply, global LNG and European storage reinforced the bullish move, while strengthening UK wind generation softened the near-term power picture into Monday morning.
Natural Gas
NBP front contracts firmed this morning on top of Friday's gains, with the front month trading around 126 p/therm against a 123.66 settlement and Winter 26 lifting to 125.91 p/therm from 122.49. Day-ahead eased slightly to around 128 p/therm as the UK system opened 3 mcm/day long and gas-for-power demand dropped to 19 mcm/day on stronger wind. The supply backdrop is the dominant driver: Troll maintenance commenced today and removes 16.5 mcm/day, Norwegian exit nominations stepped down to 289 mcm/day, and aggregate NCS outages this week are scheduled to peak on 20 May with up to 183 mcm/day offline. The global LNG picture has tightened in parallel, with JKM front month at $18.80 per MMBtu and Asian and South American buyers continuing to draw cargoes away from Europe. Industrial action at Pluto LNG starts on 20 May, while EU storage at roughly 36 per cent full with injections running 30 to 35 per cent below required pace underpins both prompt and winter contracts. TTF front month sits at 49.70 €/MWh.
Electricity
UK power tracked gas higher across the forward curve, with front month baseload offered at 104.95 £/MWh against a 102.74 settlement and Winter 26 baseload firming to 106 £/MWh from 101.37. Day-ahead baseload moved in the opposite direction, falling to roughly 90 £/MWh from a 111.94 settlement as wind generation strengthens through 22 May and gas-for-power demand falls to 19 mcm/day. Nuclear availability remains a concern further out, with Sizewell B-1 and Sizewell B-2 entering long planned outages over the next ten days and Heysham 1-2 offline through mid-June, taking more than 1.2 GW of baseload capacity off the system. The wind picture deteriorates from late next week, with output forecast to drop below seasonal norms as temperatures climb to around 5°C above seasonal average across north-west Europe, lifting cooling demand and gas-for-power requirements into the back half of the month. Continental power curves moved higher in parallel, with German Winter 26 baseload up to around 115 €/MWh.
Other Commodities
Brent crude M+1 settled at $109.26 per barrel on Friday, up $3.54 on the day, and pushed higher again this morning following the UAE strike report, with WTI M+1 at $105.42 per barrel. Coal API2 Cal Y+1 lifted to $122.82 per tonne in sympathy with gas. Carbon followed the broader complex higher, with EUA Dec 26 settling at €75.60 per tonne and UK ETS Dec at £51.15 per tonne; the back end of both curves also firmed as gas-fired generation economics moved up. JKM front month at $18.80 per MMBtu underlines a tighter global LNG market, with Asian and South American demand drawing cargoes away from Europe at a moment when European storage refill economics already look stretched. Sterling weakened against both the euro and the dollar, with GBP/EUR at 1.1488 and GBP/USD at 1.3321.