Energy Market Report - 28 May 2026
UK and European energy markets were dominated by Middle East geopolitics, with a volatile Wednesday session closing lower across gas, power and crude before reversing higher this morning on news of an Iranian strike on a US airbase. Warmer weather and stronger wind kept fundamentals soft, but escalating tension around the Strait of Hormuz reinjected risk premium across the complex.
Natural Gas
NBP and TTF eased on Wednesday as above-seasonal temperatures, firmer wind and an oversupplied British system pressured prices, compounded by a rumoured US-Iran peace framework that was later dismissed. NBP day-ahead settled 4.50 p/therm lower at 111.00 p/therm and the front month at 113.04 p/therm, with TTF day-ahead down around 1.6 per cent at €46.19/MWh. Norwegian nominations recovered towards 295 mcm/day despite an extended Oseberg curtailment, UKCS production held near 90 mcm/day and LNG sendout rose to around 12 mcm/day, leaving the system comfortably supplied and opening 13 mcm/day long. Low UK and European storage remains an underlying support, and the curve reopened several pence higher this morning as the Hormuz escalation lifted prices.
Electricity
UK baseload day-ahead settled £3.73/MWh lower at £103.08/MWh and peak at £95.93/MWh, tracking gas and helped by strong solar output that met up to 40 per cent of afternoon demand. The forward curve was little changed on the day before firming this morning in line with gas. Renewables and interconnector imports are cushioning the system, but a heavy slate of nuclear outages, including both Sizewell B units and several AGR reactors, is limiting downside on forward contracts. Wind sits near seasonal norm on the day-ahead but falls below average over the weekend.
Other Commodities
Brent settled 5.3 per cent lower at $94.29/bbl after the peace-framework reports drove a sharper sell-off than in gas or power, though crude rebounded this morning as the blockade of the Strait of Hormuz returned supply risk to the fore. Coal eased to $124.51/tonne on the front calendar. In carbon, EUAs firmed 0.69 to €78.72/tonne, holding against the broader bearish tone, while the UK ETS lacked a fresh assessment. Asian JKM slipped to $18.23/MMBtu, keeping a premium over European hubs and signalling moderate Asian demand. Sterling was marginally softer against both the euro and the dollar.