Autumn 2026 Energy Market Update: Key Risks and What to Watch
Energy prices have risen considerably over the summer, and concerns about gas supplies are extending beyond the coming winter.
In our Autumn Energy Market Update, Jitesh Panchal, Head of Markets at Trident, explores what’s driving these changes and what businesses should consider when planning their next energy contracts.
Watch the video for the full update, or read on for the key developments.
What’s happening to energy prices?
Wholesale gas and electricity prices for Winter 2026 increased by 45% and 48% respectively over the summer, as disruption to global supplies put pressure on the market.
One particularly unusual development is that gas prices for Summer 2027 are now trading above those for the following winter. Winter prices are typically higher because of increased heating demand, but the market is becoming more concerned about how Europe will replenish its gas reserves next summer.
For businesses, this means the risks aren’t limited to the months immediately ahead. Wholesale prices influence the cost of future energy contracts, making it important to review procurement plans early and understand how market movements could affect your budget.
Geopolitics - Middle East & Shipping
The ongoing conflict between the US and Iran remains one of the biggest influences on energy markets.
Shipping through the Strait of Hormuz, a vital route for global energy supplies, remains heavily restricted. This has significantly reduced the amount of liquefied natural gas, or LNG, reaching international markets.
Monthly LNG exports from the Middle East would normally reach up to 12.5 billion cubic metres. In September, exports were just 4.18 billion cubic metres.
Whilst there have been some signs of improvement, uncertainty remains around when normal supply levels might return. Further disruption could push prices higher, while progress towards reopening the route could help ease pressure as winter demand increases.
Closer to home, the Government has approved gas extraction at the Jackdaw field, with supplies expected to enter the UK gas system by the end of October 2026. This could help strengthen domestic energy security, although it won’t necessarily translate into lower prices, particularly this winter.
LNG Market
Reduced supplies from the Middle East have increased competition for the LNG available elsewhere.
Europe and Asia both rely on imports, and some Asian buyers have been willing to pay higher prices over the summer. This competition can push up prices internationally, including here in the UK.
Current projections suggest global LNG supply this winter could be between 4% and 7% lower than last year, depending on when shipments through the Strait of Hormuz recover.
In an already tight market, even a relatively small reduction in supply can have a significant effect on prices. Developments in global demand will therefore remain important, alongside any recovery in exports from the Middle East.
Weather
Weather will play a significant role in determining how much gas Europe needs over the coming months.
Current forecasts suggest the El Niño weather pattern will continue into early 2027. This could bring milder, wetter and windier conditions to parts of Europe, potentially reducing heating demand and easing some pressure on energy supplies.
However, seasonal forecasts are not guarantees. A prolonged cold spell in January or February could quickly increase demand and draw down already limited gas reserves.
Even if winter is relatively mild overall, shorter periods of cold weather could still lead to significant price movements.
European Storage
Following a difficult summer of replenishing supplies, gas storage across North-West Europe is around 66% full, approximately 12% below this time last year.
These reserves provide an important buffer when demand rises or supplies are disrupted. Starting winter with less gas in storage leaves the region more exposed to unexpected events, particularly prolonged cold weather.
The concern also extends into next year. If reserves fall too far over winter, Europe will need to buy more gas next summer to rebuild them, potentially keeping pressure on prices well into 2027.
For businesses considering future contracts, this makes the outlook beyond winter an important part of procurement planning.
Carbon & Wider Markets
Carbon prices have also risen over the summer, with UK carbon allowances increasing by 35% and European allowances by 11%.
One of the main drivers is the potential linking of the UK and EU Emissions Trading Schemes, with further discussions expected in November.
These schemes require certain businesses to buy allowances for the carbon they emit. When allowance prices rise, they can increase the cost of generating electricity from fossil fuels, particularly more carbon-intensive fuels such as coal.
Although carbon markets may feel removed from everyday energy purchasing, they remain an important influence on wholesale electricity prices
What does this mean for your business?
With supply disruption, lower storage levels and uncertain weather conditions, energy markets are likely to remain unpredictable over the coming months.
If your contracts are approaching renewal, or you purchase energy flexibly, understanding your exposure is a useful starting point. Consider how price changes could affect your costs and how much budget certainty your business needs.
It’s also important to look beyond the immediate winter. Reviewing your procurement strategy early gives you more time to consider your options, particularly as concerns about replenishing gas storage could keep pressure on prices into 2027.
The right approach will depend on your priorities and appetite for risk. Having a clear strategy can help you assess opportunities as they arise without making decisions in response to every market headline.
Need support? We’re here to help
If you’d like to understand what these developments could mean for your organisation, our team can help you review your contract renewals, procurement options and wider energy strategy.
We'll continue to monitor the market closely and share updates as the situation develops.
You can also visit the Insights section of our website for the latest market commentary, analysis and practical guidance.