Snapshot - 07 July 2026
Wholesale energy markets jolted higher on Tuesday morning after an overnight attack on commercial shipping in the Strait of Hormuz revived geopolitical risk. Gas and power had drifted lower into Monday's close on quiet summer trading, but snapped back in early trade, with prompt gas up around 4 per cent and near-dated power up 2 to 3 per cent.
Fundamentals are reinforcing the move. A building heatwave and falling wind across north-west Europe are lifting gas demand for power generation and tightening the system, with French nuclear facing heat-related cooling constraints and several UK reactors offline. Physical supply itself remains adequate, with steady Norwegian flows and a healthy schedule of LNG arrivals, so the strength is risk- and weather-led rather than a supply shortfall.
Across the wider complex, carbon firmed while crude held near 72 dollars a barrel, although oil's latest settlement closed before the escalation and carries upside risk. Notably, the far curve moved far less than the front, suggesting the market is pricing a short-lived premium. A weekend recovery in wind, or any de-escalation in the Gulf, could unwind much of the gain.
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