05 November 2026

Weekly Energy Market Update 

Outlook

Volatility has increased further this week, driven by geopolitical news, with Summer 27 gas reaching 184.00 p/th on Friday and a low of 150.10 p/th yesterday. Markets have read the shift in congressional control after the midterms as bearish for oil and gas: although military decisions remain largely with the President, congressional resistance and pressure within his own party make further escalation less likely and funding for a prolonged conflict harder to secure. The January Brent contract has fallen from $114.30/bbl at the end of last week to $96.00/bbl. Yet, at the time of writing, another tanker has reportedly been struck in the Strait of Hormuz, a reminder that shipping disruption persists and that the conflict may settle into a stalemate rather than a resolution. The next direction for oil and gas will therefore depend on whether de-escalation rhetoric translates into a sustained recovery in Persian Gulf exports. In the meantime, we view the near 15% fall in December and Q1 27 gas prices as a good opportunity to hedge any remaining open exposure for those periods.

 

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General Context
Rise

The BoE raised interest rates by 25 basis points to 4%, its first increase since August 2023, as higher energy costs pushed inflation above the Bank’s forecasts. Inflation rose to 3.5% in September, an 11-month high, driven largely by the conflict in the Middle East and the resulting surge in petrol and diesel prices.

Factory

UK private-sector activity strengthened in October, with the composite PMI, covering services and manufacturing, rising to 52.9 from 52.0 in September. Services growth reached an eight-month high, while manufacturing output expanded at its fastest pace in more than two years.

Oil

Oil prices have posted significant losses over the past week, with front-month Brent falling about $15 as diplomatic efforts gathered pace and markets pared some of the geopolitical risk premium tied to the US-Iran conflict after the US election results.

US inventory data remained supportive, with distillate stocks dropping below 100mn barrels for the first time since 2003 and crude inventories declining for a fifth straight week. Strong product exports have also drawn down domestic stocks, keeping refined fuel markets tight.
Oil

Gas & Power
Gas

Equinor shut production at its Visund oil and gas platform in the North Sea yesterday after a fire in an electrical system, which has since been extinguished. Around 70–80 of the 128 personnel were moved to nearby installations. Gassco has set the unplanned outage’s end date to 9th November but flagged the duration as uncertain.

Nuclear

Nuclearelectrica will reconnect Unit 1 at Cernavoda to the Romanian grid on 6th November, reaching full capacity by 7th November, after record-low Danube levels forced both 706 MW reactors offline in late July and early August. Unit 2 will return only once Danube levels rise sustainably.

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Japan is set to overtake China as the largest LNG importer this year, according to ICIS and Kpler. Chinese demand remains below its 2021 peak as renewables, domestic production and pipeline gas displace LNG, while a forecast mild winter, higher prices from the war in Iran and storage 80–90% full add further pressure. Japanese demand is also falling, though more slowly, as nuclear reactors restart.

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

Chancellor's Renewables Plans Threaten Scottish Jobs

Aberdeen & Grampian Chamber of Commerce (AGCC) has warned that the government's new renewable energy approach could threaten billions in offshore wind investment and thousands of Scottish jobs.

The Budget introduced conditions requiring new clean power projects to reduce electricity bills and secure grid connections, raising concerns for Scotland's emerging floating offshore wind sector.

AGCC is urging the government to provide sufficient funding in upcoming Contracts for Difference auctions and ensure Scotland's offshore wind pipeline is reflected in future energy planning. With over 23GW of floating wind projects proposed, the Chamber estimates Scottish businesses could secure up to £34.8 billion in contracts.
Sustainability_Spotlight

 

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