Hostilities have resumed near the Strait of Hormuz and US sanctions on Iran have tightened, yet UK power itself actually eased this week. The strength sits in the gas curve, not in domestic scarcity.
Summary:
- Prices held near recent highs, finishing slightly up after three weeks of strong gains.
- US sanctions on Iran tightened further, and Tehran approved transit fees for ships using the strait, with a threat to seize vessels that ignore them.
- The truce window has now formally lapsed, and reports point to renewed military action near the strait over the weekend.
- A compressor fault at Norway’s Asgard field cut gas flows to Britain just as earlier outages were clearing.
- European storage remains below normal for the season, with Britain and Germany only around half full.
- UK power on the day actually softened, as wind held up and late summer demand stayed light.
Market commentary:
Prices steadied near recent highs, finishing the week slightly up after three weeks of strong gains. The US reportedly announced a sweeping new sanctions package against Iran, while Tehran approved transit fees for ships using the strait and threatened to seize vessels that ignore them. Omani mediation continued midweek and briefly cooled prices, but the truce window has now formally lapsed. Reports suggest the US struck Iranian rocket launch sites on the strait over the weekend, the first military action in weeks.
Supply tightened again closer to home. A compressor fault at Norway’s Asgard field cut flows to Britain sharply just as earlier outages were clearing. European storage remains well below par for the season, with Britain and Germany only around half full while southern Europe is far better placed.
UK prompt power softened as wind held up and late summer demand stayed light. That’s a reminder that the strength sits in the gas curve rather than any domestic scarcity today.
With hostilities resuming and sanctions tightening, the market opens September firmly supported.
What this means for your business
Fixed contract holders
- Your current rate is protected until your contract ends. This week’s moves do not change what you pay now.
- Renewal quotes issued during periods like this tend to come in higher, so start your renewal conversation early rather than waiting for the notice period.
- Ask us to flag your renewal date so we can start planning before the market moves again.
Flexible contract holders
- You are exposed to this volatility directly, so this week’s gains sit in your position already.
- Ask your energy specialist how much of your usage is hedged at current levels and how much is still open.
- Review your risk tolerance now, particularly with hostilities resuming near the strait.
Get the full update
Download the full wholesale market update as a PDF for your records Rybeda 1st September Weekly Energy Market Update, or to share with your operations & finance team.
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