UK Energy Market Update - Early June 2026

UK Energy Market Update
Early June 2026

Energy markets saw mixed movements into early June, as renewed geopolitical tensions supported longer-term power prices while weaker demand and improving supply conditions weighed on gas markets.

Electricity Market Movements

Longer-term power prices moved higher as renewed tensions in the Middle East continued to influence market sentiment and future supply concerns.

Rising UK carbon prices provided additional support for longer-term electricity contracts, particularly as discussions around closer alignment with the EU market continued.

Short-term power prices remained under pressure from improving supply conditions, including stronger renewable output, lower demand and the expected return of nuclear and import capacity.

Gas Market Movements

Gas prices softened overall through the second half of May, despite occasional spikes linked to developments in the Middle East.

Limited LNG shipments have continued to move through the Strait of Hormuz, providing some reassurance that supply routes remain partially operational.

European gas storage continued to build during May, but storage levels remain well behind schedule creating a less favourable supply outlook ahead of winter.

Markets are likely to remain sensitive to developments in the Middle East, LNG availability and storage levels across Europe. While improving supply conditions have eased some pressure on gas markets, geopolitical developments continue to influence longer-term pricing.

At CES, we help businesses navigate changing market conditions with risk-managed procurement strategies built for stability and long-term planning.