27 August 2026

Weekly Energy Market Update 

Outlook

Gas markets have been volatile, with W26 gas prices trading higher week-on-week despite easing from recent highs. The Middle East continues to be the dominant driver, with tentative hopes of progress after Iran and Oman discussed establishing a temporary joint maritime corridor and a potential permanent route through the Strait of Hormuz, alongside a growing number of stakeholders involved in ongoing negotiations. However, there is caution over whether these efforts will result in an immediate reopening of Hormuz and even a partial restoration of Qatari LNG flows, while a tight global gas balance and Europe’s low storage levels remain a concern as the injection season nears its end. Further supply-side support emerged after Gassco, Norway’s gas transmission system operator, reported two unplanned outages ahead of a significant increase in planned maintenance over the coming days. Taken together, prices are likely to remain sensitive to developments in the Middle East, with supply concerns continuing to provide underlying support.


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General Context
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UK retail sales fell 0.5% m/m in July, reversing a 0.7% rise in June, as weaker clothing and furniture sales outweighed a World Cup and heatwave-driven boost to food and drink spending.

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Activity in the UK services sector strengthened unexpectedly in August, with the PMI rising to a six-month high of 52.8. However, manufacturing growth slowed to a five-month low of 51.5, partly as precautionary stock building eased.

Oil

Brent crude is trading lower week-on-week, as hopes of easing tensions around the Strait of Hormuz and improving Saudi oil exports weigh on prices despite continued military unrest.

Morgan Stanley raised its Q4 2026 Brent forecast to $100/bbl from $75/bbl, citing a slower recovery in Middle Eastern supply and expectations that the oil market will remain in deficit into early 2027.
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Gas & Power
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Equinor started production from Troll Phase 3 Stage 2 on 22 August, ahead of schedule. The eight-well project will bring forward 55 bcm of gas from Troll West, helping offset natural decline and maintain high output from Troll, which currently supplies around 10% of Europe's gas demand, towards 2030.
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The Netherlands is set to miss its 1 November gas storage target of 115 TWh, or around 82% of capacity, with stocks currently at 44.9%. The shortfall reflects a broader European trend, with EU inventories currently 63.5% full, 13 percentage points below last year. The Dutch government has tasked state-owned EBN with supporting injections, although Gasunie warned the country could remain vulnerable in the event of a particularly cold winter.

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French nuclear availability remains unusually low at 33.9 GW, or just 54% of installed capacity, as several reactors curtailed during the heatwave now face unplanned outages, while jellyfish-related disruption has extended outages at Gravelines. The shortfall has increased reliance on gas-fired generation, supporting short-term power prices in France and neighbouring markets, including the UK.

Current Prices
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UK Gas (NBP) - Rolling 12-Month Average
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Sustainability Spotlight

Europe's Clean Manufacturing Push

Europe is pushing to strengthen clean manufacturing while keeping its industries globally competitive. With competition from the US and China growing, policymakers are exploring incentives to support European production of batteries, renewable technologies and other low-carbon products.

Energy will be central to this challenge. European manufacturers already face high operating costs, making access to affordable, reliable and increasingly renewable power critical.

For businesses, this puts energy strategy firmly on the commercial agenda. Competitive procurement, improved efficiency and renewable energy contracts can help reduce costs, limit exposure to volatile fossil-fuel markets and cut emissions, strengthening both resilience and competitiveness.
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