Gas Market
UK wholesale gas prices rose on Friday as renewed tensions in the Gulf rattled markets. The front-month NBP contract climbed 1.24p to settle at 108.11p/therm after reports emerged that three U.S. Navy destroyers had been attacked while transiting the Strait of Hormuz. Iran’s top military command accused the U.S. of violating the ceasefire by targeting an Iranian oil tanker and a second vessel, threatening the month-old truce and dashing hopes of a diplomatic resolution. NBP futures fell over 6% across the week, with the Winter-26 contract shedding 7.38p from last Friday’s close as ceasefire hopes kept prices under pressure. News emerged over the weekend that the first Qatari LNG vessel, Al Kharaitiyat, had successfully transited the Strait of Hormuz and is expected to offload in Pakistan, offering some reassurance over supply routes. On the prompt, colder weather added a further lift, with the next-week contract rising 8.35p to 108.4p/therm as temperatures are forecast to fall well below average, boosting near-term gas demand.
Power Market
GB baseload power contracts climbed higher on Friday, with the front-month June contract gaining £1.10 to settle at £92.35/MWh. Gains were broad-based across the forward curve, supported by rising gas prices out to 2028 and further uplift from Carbon UKAs. Prompt prices moved in the opposite direction, with the day-ahead contract falling £2 to £103/MWh as higher wind output weighed on near-term prices.
Carbon markets were muted on Friday. The Dec-26 EUA settled marginally higher at €75.18/tonne, capping a modest recovery from the low-70s seen in late April. The rebound has been supported by calmer policy headlines and a growing perception that the upcoming ETS review will deliver more gradual changes than previously feared. EUAs finished the week up 1.9%. UKAs saw a stronger session, with the front contract rising 2.9% to £50.23/tonne.
Oil Market
Brent crude futures jumped as much as 3% on Friday, a day after the U.S. and Iran traded air strikes, before paring gains as the conflict showed no signs of further escalation. Front-month Brent settled at $101.29 a barrel, up $1.23 on the day. The Friday bounce did little to offset a week of declines for oil prices. Brent shed 6% over the course of the week as hopes for a breakthrough in U.S.-Iran negotiations weighed on prices throughout. A report released over the weekend showed China’s crude oil imports fell to their lowest level in almost four years in April, as the closure of the Strait of Hormuz choked off supplies to the world’s largest oil importer. Imports for the month dropped 20% year-on-year to 38.5 million metric tons, the weakest reading since July 2022. With roughly half of its crude sourced from the Middle East, China has moved to tightly manage exports of refined products such as gasoline and jet fuel to protect its domestic market. Despite April’s slump, crude imports for the first four months of the year remain 1.3% ahead of the same period last year.
Markets This Morning
British gas contracts firmed on Monday after another attempt to end the U.S.-Israel war on Iran failed, even as the first Qatari LNG tanker successfully sailed through the Strait of Hormuz to deliver cargo to Pakistan. The front-month NBP Jun-26 is up 0.86p at 108.97p/therm, while Winter-26 has gained 1.7p to 112.06p/therm, after President Trump on Sunday swiftly rejected Iran’s response to a U.S. peace proposal, calling it “unacceptable.” Oil prices have also moved higher, with Brent up $2.69 at $103.98/bbl. Markets now turn their attention to Trump’s scheduled arrival in Beijing on Wednesday, where discussions with President Xi Jinping are expected to include Iran.
