Headlines in this weeks Mini Energy report:
• Prices are increasing due to the conflict between the US and Iran.
• The Strait of Hormuz is effectively closed, impacting on LNG and Oil exports from the region.
• EU Gas Storage is low, which is adding pressure to prices.
As of the 13th of July, Gas and Electricity Year Ahead Wholesale costs were higher than last week, with further gains being seen today. There is still a considerable discount for contracts starting in 2027 and 2028. Oil is also higher, currently at $87 from $72.
The resumption of hostilities between the US and Iran has meant the almost complete closure of the Strait of Hormuz, due to the recent attacks on shipping. President Trump has said a 20% fee will be charged on shipping passing through it, as well as once again blockading Iran’s ports.
Qatar is delaying the repair of LNG infrastructure that was previously damaged. This impacts on deliveries and tightens global supplies. The EU’s Gas Storage is low at just 52% full compared to 63% in 2025. Reduced Gas supplies and the higher costs will make it hard to refill for the winter.
The last week saw Gas provide 28% of generation, Wind 14% and 21% via the Interconnectors. High temperatures across much of Europe are increasing energy demand for air cooling.
We would encourage customers with contracts that end in the next few months to discuss your renewals with us, and we will look to provide further advice and support as required.
