April Energy Market Update

Market news

March 2026 was one of the most volatile months in recent energy market history. Following a relatively stable period in February supported by mild weather, strong renewable output, and healthy LNG supply, the outlook quickly evolved into severe geopolitically driven market shock.

By early March, coordinated US–Israeli strikes on Iran, the killing of key Iranian leadership, and subsequent retaliatory attacks triggered a chain of events that resulted in around 20% of world supply of LNG and Oil been curtailed. The escalation of attacks saw the suspension of Qatari LNG production and damaged to its facilities, which could take several years to return to full capacity.

Further attacks on other regional energy infrastructure and shipping continued throughout the month which moved gas and power prices significantly higher as a result, although they did not peak at the same level as the 2022 energy crisis. The 14-day ceasefire announced on 7th of April has seen prices fall back around 20% although analysts believe this to be inherently fragile and expect. price volatility in the near term. 

Key market drivers during period 

Outlook 

 The near‑term outlook remains highly volatile, with geopolitical risk continuing to outweigh traditional supply and demand fundamentals. The ceasefire announcement has seen prices start to track downwards amid the prospects of shipping to resume travel through Strait of Hormuz for the next 2 weeks. However, many LNG/Oil facilities including the main Qatari production has been suspended during the conflict, therefore even if diplomatic progress occurs and the ceasefire holds any recovery in physical LNG flows is expected to be slow and global gas balances will remain structurally tight.

As a result, UK and European gas and power prices are expected to remain elevated this summer, with a strong bias to the upside and the potential for sharp, sentiment‑driven spikes should tensions re-escalate and conflict is not resolved within the next few weeks. 

Gas Price Movement Feb -April 26

The impact on prices from the current conflict is highlighted below with values currently around 50% higher than at the end of February.