Gas Market
UK wholesale gas prices moved higher again on Tuesday as uncertainty surrounding U.S.-Iran ceasefire negotiations continued to support the market. The benchmark Winter-26 contract rose by 0.77p/th to settle at 116.09p/th, extending gains over the past three sessions to 6.73p/th since last Thursday’s close. The front-month Jun-26 contract also strengthened, rising 1.37p/th and bringing its three-day gain to 7.93p/th. Market sentiment remained supported after the U.S. Energy Information Administration said it now expects disruption in the Strait of Hormuz to persist until at least month-end, with Gulf trade flows potentially taking until late 2026 or early 2027 to fully normalise. Prices were little moved by reports that the Mihzem LNG tanker became the second vessel to transit the Strait. Despite limited traffic through the waterway, the UK market remains comfortably supplied through domestic production and strong Norwegian pipeline imports.
Power Market
Near curve GB Baseload prices tracked gains o wholesale gas markets, but contracts further out retraced some of the previous session’s gains. With movements on gas less pronounced further along the curve, GB baseload power fell from WInter-26 onwards, pressured by declining UKA carbon prices. UK carbon prices fell by over £1.75/tonne which weighed heavily on power prices, providing more impetuous than the rising gas costs.
EU carbon prices fell in trading on Tuesday as the European Commission signalled its intent to slow the phase-out of the ETS, with allowances now likely to be issued well into 2040. Under current legislation, the EU ETS is scheduled to run until 2039, with the annual cap on emissions continuing to tighten throughout the decade.
Oil Market
The front-month Brent crude oil contract rose to $107.77/bbl on Tuesday, extending recent gains as markets increasingly priced in a prolonged disruption to Middle Eastern supply following stalled U.S.-Iran ceasefire negotiations. Concerns remain centred on the Strait of Hormuz, a critical transit route for global crude and LNG flows, with the U.S. Energy Information Administration now expecting disruptions to persist through late May. OPEC output has already fallen sharply amid curtailed exports, while analysts warn that tightening inventories and limited spare capacity could deepen the supply deficit into 2026. Although some participants expect higher prices to eventually dampen demand, the market currently remains focused on constrained supply and the risk of further geopolitical escalation.
Markets this morning
UK wholesale gas prices have eased in early trading as markets focus on U.S. President Trump’s visit to China ahead of the much-anticipated meeting with Xi Jinping. The front-month gas contract was last traded at 113.96p/th, down 0.84p from Tuesday’s settlement. Crude oil has also edged lower, last trading at $107.28/bbl, as traders await the outcome of the scheduled Trump–Xi discussions later this week. Sentiment in oil was further softened by reports that the Chinese supertanker Yuan Hua Hu is attempting to transit the Strait of Hormuz carrying around two million barrels of Iraqi crude, following yesterday’s successful crossing by a Qatari LNG tanker. EU carbon prices continued to drift lower following indications that the European Commission may extend the ETS into the 2040s.
