6 August 2026

Weekly Energy Market Update 

Outlook

Gas and power prices have fallen sharply week-on-week on hopes of a diplomatic breakthrough in the Middle East. The US President said his administration held constructive discussions with Iran during day-long negotiations on Tuesday, while reports of a proposed agreement between Iran and Oman have raised hopes that the Strait of Hormuz could reopen soon. For now, however, tanker traffic through the Strait remains limited, and together with Europe's record-low gas storage levels, this is likely to continue supporting forward prices. Meanwhile, prompt markets remain underpinned by another heatwave, this time centred on Central and Eastern Europe.


bull-jpg

 
Gas_Power

General Context
Flag_of_Europe

European shares are at a record high as optimism over a potential US - Iran peace deal and progress towards reopening the Strait of Hormuz have boosted sentiment. Strong corporate earnings have also supported markets, with second-quarter STOXX 600 earnings now expected to grow by nearly 21%.

Germany_Flag

German industrial orders rose 3.1% month-on-month in June, beating the 0.3% forecast. However, excluding large orders, bookings fell 0.5%, while May's growth was revised down to 0.3% from 1.9%, highlighting continued weakness in underlying demand.

Oil

Oil prices have fallen by around 10% week-on-week to $79.50/bbl, their lowest level in three weeks, as optimism over a potential US - Iran agreement has raised hopes that commercial shipping through the Strait of Hormuz could soon resume.

OPEC+ has approved a 188,000 barrel-per-day production increase for September 2026, completing the rollback of its 2023 voluntary supply cuts. The final increase is intended to support global oil supplies and defend market share amid ongoing geopolitical uncertainty.

 
Oil

Gas & Power
Nuclear_Icon

 

Ongoing heatwaves across Europe are putting increasing strain on electricity systems. In Hungary, consumers have been asked to reduce power use, while low river levels have forced nuclear generation cuts in both Hungary and Slovenia. In France, too, heat-related restrictions continue to limit nuclear output.

LNG_Icon

 

 

Three US LNG cargoes originally destined for Egypt have been redirected to France and Spain following last week's drone attack on the Damietta LNG terminal. Analysts say additional cargoes may be diverted to Europe as damage at Damietta is assessed, potentially increasing LNG availability.

Gas_Icon_Market_Update
 

The combination of low LNG deliveries and ongoing heatwaves supporting demand continues to slow the pace of gas storage injections, with European inventories increasing by just 3.5 percentage points over the past two weeks to 57.9%. This is below the record-low level seen in 2021 and is 12.4 percentage points below 2025.

Current Prices
Screenshot 2026-08-06 at 14.26.00

UK Gas (NBP) - Rolling 12-Month Average
Screenshot 2026-08-06 at 14.26.12

Sustainability Spotlight

The Effectiveness of Carbon Tax

The UK's Carbon Border Adjustment Mechanism (CBAM), due to take effect in 2027, will apply a carbon tax to certain imports, helping prevent emissions from being shifted overseas. However, unless the UK secures exemptions through a UK–EU emissions trading agreement, businesses could face an estimated £800 million EU carbon tax bill by 2030. Industry groups are urging a temporary arrangement to reduce trade friction until a formal agreement is in place.
Sustainability_Spotlight

 

Talk to our experts

 

All information displayed on this report is to be used for indicative purposes only. The accuracy can not be fully guaranteed and as such True Group holds no liability for actions taken based on the information presented in this report. The contents of the report may not be reproduced, copied or defaced without prior written consent of True Group.