Energy Market Report - 24 August 2026
European energy markets closed last week on the front foot, with a hardening US sanctions regime against Iran and continued disruption around the Strait of Hormuz driving a sixth consecutive session of gains in gas and pulling power forwards up with them. Crude held above $94/bbl on the same story, while carbon and coal firmed modestly and sterling was largely unmoved.
Natural Gas
Gas rose on Friday because of politics, not physics. The US Treasury announced its most aggressive sanctions package yet on Iran, targeting oil smuggling, swap lines and front companies, and the UAE suspended financial and economic dealings with Tehran, keeping a substantial risk premium on near-dated contracts. NBP day-ahead settled at 164.00 p/therm, up 2.75 p/therm, with September at 162.58 p/therm and Winter 26 at 164.01 p/therm, while TTF day-ahead traded around €66/MWh. Physical supply was actually improving: Gassco nominations recovered to 324.5 mcm/day as Kårstø came back from an unplanned outage, and Norwegian flows into the UK have since risen to 78 mcm/day from 58 mcm/day on Friday, even though Troll maintenance started today and is cutting 24.4 mcm/day. What continues to underpin the market is storage. EU inventories sat at 61.82 per cent full on 19 August, around 12.4 percentage points below the same point last year, with Germany at 50.19 per cent and injections still lagging. UK LNG sendout is unchanged at 8 mcm/day and the system opened today 24 mcm/day long.
Electricity
UK power pulled in two directions. Day-ahead baseload fell £21.98/MWh to £119.99/MWh, with the peak block down £37.22/MWh to £98.21/MWh and settling below baseload, a pattern consistent with heavy midday renewable output on a light-demand day. Wind was broadly flat on the session at roughly a quarter of generation. Forwards, by contrast, followed gas and carbon higher, with September baseload up £1.57/MWh to £128.80/MWh and Winter 26 up £1.06/MWh to £134.44/MWh. Availability is the swing factor into the autumn: Torness 1, Heysham 1 unit 1 and Hartlepool 2 are all offline, and Heysham 2 unit 8 starts an 80-day outage on 4 September. On the Continent, French heat-related nuclear curtailments are forecast to rise again to just under 7 GW tomorrow on low river flows, offsetting the 8 GW of recovery seen through last week, while Hungary's Paks plant is ramping back up as Danube levels rise.
Other Commodities
Brent M+1 settled at $94.39/bbl, up $0.61 and posting a second consecutive weekly gain on Middle East supply risk, though prices have eased this morning ahead of a further expected US sanctions announcement. Coal API2 ARA Cal 27 added $0.49 to $128.77/tonne, with the 2028 and 2029 contracts clustered near $119/tonne. In carbon, EUA Dec 26 settled at €82.61/tonne and UK ETS Dec 26 at £59.49/tonne, leaving UK allowances roughly £11/tonne cheaper than their European equivalent once converted at Friday's exchange rate, a discount that continues to shelter UK generators from part of the compliance cost their continental peers face. In LNG benchmarks, JKM M+1 rose to $22.94/MMBtu against NBP spot at $22.36/MMBtu, a spread too narrow to divert Atlantic cargoes away from Europe, while Henry Hub spot was steady at $2.82/MMBtu. Sterling was quiet at 1.1673 against the euro and 1.3633 against the dollar.