Snapshot - 13 October 2026
European gas markets set fresh yearly highs on Monday, extending a run of gains into a fifth consecutive session. The move was driven by a genuine shift in the weather outlook, with north-west Europe now expected to dip below seasonal norms this weekend after an unusually mild start to the winter, alongside tightening Norwegian supply and an LNG arrivals schedule running below its month-to-date pace. UK prompt gas settled just above 200 p/therm and the front-month contract moved up into the low 210s, with gains of more than 14 per cent over the week. Storage remains the structural story: European inventories are running close to nine per cent behind the same point last year, which is limiting the market’s willingness to discount even the far end of the curve.
Power followed gas higher across the curve, with the UK winter months now trading in the £165 to £180/MWh range and day-ahead settling in the mid-£120s for Monday delivery. Monday’s intraday shape was wide, clearing well above £240/MWh on the morning ramp before strong midday renewable output pushed prices into the mid-£50s by late afternoon. The forward picture is tighter than that volatility suggests: nuclear availability remains impaired with several units offline or derated, there is no coal on the system, and wind output is forecast to drop appreciably below seasonal norms into next weekend. With gas and carbon where they are, generation margins on front-month contracts are close to breakeven.
Across the wider complex, crude firmed on Monday to above $106/bbl before easing back towards $105 as traders weighed Middle East escalation against the prospect of additional Russian supply reaching the market. Coal continued its grind higher, supported by global LNG shortfalls pushing generators towards alternative fuels. Carbon added to the cost stack in both schemes, with European allowances at multi-month highs and UK allowances rising faster still, narrowing the discount between the two. Sterling softened slightly against the dollar and firmed against the euro. The overall direction of travel remains firmly upwards, and the near-term risk continues to sit on the upside until either the weather turns milder or the supply side loosens.
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