Daily Energy Market Report - 17th May 2026

UK wholesale gas and electricity prices surge on Hormuz crisis, collapsed wind output and critically low UK storage

UK energy markets posted one of their sharpest single-day moves of the year, with the NBP spot price surging 6.86% to 128.5p/therm and UK power hitting £119.37/MWh – a near-18% intraday jump. Three factors are converging simultaneously: an escalating Strait of Hormuz crisis disrupting global LNG shipments, UK wind generation collapsing to just 3.5 GW, and UK gas storage sitting at a critically thin 10% – the lowest level in Europe.

Gas Market – Near-Term Contracts Surge on Hormuz and Storage Fears

The NBP day-ahead contract has surged to 128.5p/therm, with near-curve contracts posting weekly gains of 11-15%. The Jun-26 front-month is at 123.66p (+14.4% on the week), with the Q3 and Winter-26 contracts closely bunched around 122-123p, an unusually flat near-curve that reflects broad alarm about near-term supply security.

The primary driver is the Strait of Hormuz. Approximately 20% of the world’s LNG trade previously flowed through this waterway, and commercial transit remains severely constrained. No near-term LNG cargo arrivals are scheduled into UK import terminals, removing a critical supply source at the worst possible moment.

Norwegian pipeline flows are holding steady, Langeled at 27.4 mcm/day, but insufficient to compensate for absent LNG against a backdrop of UK storage now the thinnest in Europe at just 10%.

Longer-dated contracts are also rising: Cal-28 at 72.06p (+2.0% week), Cal-27 at 96.04p (+6.0%). The forward curve still offers a discount to current spot, but the gap is narrowing.

Electricity Market – Power Spikes as Wind Collapses

UK power spot hit £119.37/MWh, a near-18% intraday surge driven almost entirely by the collapse in wind generation. Wind output has fallen more than 60% day-on-day to just 3.5 GW, removing a key source of low-cost generation and forcing the system to lean more heavily on gas-fired plant at exactly the moment gas input prices are spiking.

The Jun-26 baseload contract has firmed to £102.74/MWh (+11.6% on the week), Winter-26 at £101.37/MWh (+7.3%), and even Cal-28 power at £67.10/MWh is now showing a weekly gain. Wind forecasts are expected to recover somewhat next week, which may cap further spot gains short-term, but the structural picture of rising gas costs, thin storage and absent LNG remains firmly bullish for near-term contracts.

Oil, Carbon and Global Commodities

Commodity	Price	Change (day)
Brent Crude	$109/barrel	▲ +1.5%
WTI	$103/barrel	▲ +1.0%
EUA Carbon (Dec-26)	€75/tonne	▼ -0.5%
JKM LNG (front-month)	$17.73/MMBtu	–
TTF Gas (front-month)	€46.68/MWh	–

Brent crude has pushed to approximately $109/barrel as the Strait of Hormuz situation remains unresolved. Around 25% of the world’s seaborne oil trade previously transited this waterway, and the ongoing disruption continues to underpin a significant geopolitical risk premium. A further risk looms this week: Australian LNG workers have flagged potential strike action from 20 May, which would remove another LNG supply source from global markets at exactly the point European buyers are scrambling for alternatives.

Storage and Supply Outlook

UK gas storage sits at just 10% capacity, the lowest level in Europe, contrasting sharply with Spain at 65% and Germany above 30%. The injection season has begun, but with LNG arrivals absent and demand still elevated by persistent cold weather, meaningful storage builds have not materialised. Any further delay to injection significantly raises the risk profile for Winter 2026 and will be closely watched by market participants over coming weeks.

The Ofgem quarterly price cap review is due for announcement on 27 May, taking effect from 1 July. While domestic in focus, the announcement will reflect the same wholesale dynamics that are currently driving commercial contract pricing sharply higher.

What This Means for Your Business

Yesterday’s market was tight. Today’s is alarming. A near-18% intraday jump in spot power and a 6.86% surge in NBP gas in a single session is an extraordinary move, and the underlying drivers, Hormuz crisis, absent LNG arrivals, collapsed wind and storage at just 10% – show no sign of near-term resolution.

If your contract expires in the next three months, this market is becoming increasingly costly to enter. Waiting for conditions to improve assumes the Hormuz situation resolves quickly, storage fills at pace, and wind returns to seasonal norms,  all simultaneously. That is a significant risk to carry.

If your contract expires later in 2026 or into 2027, the forward curve still offers relative value. Cal-28 contracts remain at a material discount to current spot, though that gap is narrowing day by day.

Whatever your position, the most important step is to understand what your current contract costs against what today’s market offers. If you are out of contract or approaching renewal, this is not a time for delay. Speak to one of our energy consultants today – no obligation, no cost, just clear and independent advice.