Energy Market Report - 25 June 2026
Energy markets fell across the board in Wednesday's session as the geopolitical risk premium attached to the Middle East continued to unwind, dragging gas, power and crude lower while carbon firmed against the trend. Recovering shipping through the Strait of Hormuz, strong LNG supply and forecasts for cooler UK weather set a broadly bearish tone, though prices steadied in early trade on Thursday.
Natural Gas
UK and continental gas prices sold off sharply on Wednesday before stabilising this morning, with the move driven by easing Middle East risk rather than fundamentals. The NBP day-ahead settled at 98.65 p/therm, down about 3.3 per cent, while TTF day-ahead was assessed near €40.68/MWh, off roughly 2.6 per cent; the NBP front-month sits around 97.5 p/therm in early Thursday trade. Norwegian flows are comfortable, with total exit nominations broadly flat near 337 mcm/day and Langeled around 57 mcm/day, while LNG arrivals into north-west Europe surged to roughly 410 mcm/day and UK sendout held at about 8 mcm/day with a further cargo due at the Isle of Grain. The US-Iran ceasefire, recovering Hormuz traffic and the Qatari prime minister's signal that Qatari LNG could return within weeks all weighed on the curve, though EU storage below 50 per cent and residual supply uncertainty kept a floor under forward prices.
Electricity
UK power followed gas lower across the curve on Wednesday despite a tight evening peak. With wind meeting only around 10 per cent of demand and gas-fired plant running near 14.4 GW, the system operator issued an Electricity Margin Notice and arranged a short-notice system-operator trade with France's RTE to cover an overnight shortfall, briefly spiking balancing prices; even so, the day-ahead baseload settled sharply lower at £115.04/MWh as fuel costs fell. The winter 2026 baseload eased about 1.4 per cent to £94.48/MWh and calendar 2027 slipped to £79.69/MWh, with carbon broadly flat. Nuclear availability remains a swing factor: several UK reactors are offline, including unplanned outages at Heysham and Hartlepool, while French nuclear has fallen to around 38 GW in the heat, a constraint the forecast cooldown should ease over the coming days.
Other Commodities
Crude led the wider complex lower, Brent shedding more than 4 per cent on the day to $73.74/bbl and WTI falling to $70.34/bbl, leaving both down roughly 7 to 8 per cent on the week as recovering Hormuz traffic pulled prices back towards pre-conflict levels; Iraq added uncertainty by hinting it may weigh leaving OPEC if its quota is not raised. Coal eased in sympathy, the ARA calendar 2027 contract down about 1.6 per cent to $110.39/tonne. Carbon bucked the trend, with UK allowances up around 1.2 per cent to £56.81/tonne and European allowances at €80.78/tonne for December 2026, leaving UKAs at a wide discount to EUAs once converted at current rates. In LNG, the Asian JKM front-month eased to $15.55/MMBtu and Henry Hub held near $3.19/MMBtu, while sterling was little changed against the euro at 1.1606 but softer against the dollar at 1.3165, down about 1 per cent on the week.