Snapshot - 26 August 2026
UK gas and power prices fell back on Tuesday after a seven-session rally that had carried winter contracts to their highest levels in more than three years. The trigger was diplomatic rather than physical: reports of progress towards a temporary shipping corridor through the Strait of Hormuz prompted traders to take profit on an overbought market. Day-ahead gas fell around five pence to the low 160s p/therm, and the Winter-26 season lost a similar amount to settle in the mid 160s. The selling has continued this morning, with both contracts indicated several pence lower again.
The physical backdrop remains comfortable and is doing little to support prices. Norwegian flows eased slightly but were more than offset by stronger UK Continental Shelf production, and the system is running long enough to keep exporting to the continent while still injecting into storage. Above-seasonal temperatures are forecast to persist into early October, keeping heating demand subdued. The one genuinely bullish factor is European storage, still only around 62 to 63 per cent full and among the lowest levels for this time of year, which explains why the winter contracts keep attracting buyers whenever they dip. Power followed gas lower across the curve, though day-ahead prices firmed on a tight evening block despite wind output roughly doubling day on day. British nuclear availability thins further through early September as planned outages stack up.
Across the wider complex, crude fell close to four per cent on the same Hormuz optimism, shrugging off a substantial new US sanctions package aimed at Iranian oil revenues. Coal drifted lower in sympathy. Carbon was the exception, with both European and UK allowances firming modestly on the day and up over two and a half per cent on the week, keeping a floor under thermal generation costs. Sterling was unchanged against the euro and barely moved against the dollar.
This Snapshot offers a concise view of market trends. For comprehensive daily reports, strategic analysis and tailored advisory support, Lumley Consulting provides independent insight across gas, power and wider energy markets. Learn more about our premium subscriptions and consultancy services here.