April 2026 Review

April was a month where the energy markets offered sources of optimism but failed to follow through in a meaningful way. A peace deal in the Middle East seemed within touching distance, but the conflict will now continue into May, leaving markets clouded by uncertainty.



UK gas prices for the upcoming winter peaked in the first week of the month. Prices then fell when it seemed likely that an agreement could be reached between the US and Iran. As peace talks were delayed -- and amidst inconsistent messages from the US leadership -- prices began to rise again – reaching a price level almost on a par with the beginning of April.

The war between the US/Israel and Iran had begun at the end of February. The conflict led to the Strait of Hormuz – where over 20% of the world’s LNG exports travel through – being shut down, with safety concerns amid threats to cargo ships from Iran – and later the US. In the days following the commencement of the war, gas and electricity prices spiked. They have since come down from their high point but are yet to return to their pre-war levels.

On April 8^th, a ceasefire was announced. This led to falling energy prices as most market participants assumed a peace-deal could be established within days. However, mixed public statements from the US have led to uncertainty about just how quickly a deal can be reached. The more time that passes without an agreement being achieved, increases the probability of a resumption of hostilities and prolongs the timeframe in which the Strait of Hormuz can reasonably be expected to re-open.

With limited LNG available for export, European nations have been locked in a bidding war with many Asian nations. So far, Japan and South Korea have been winning the bidding war. This has forced may European nations to look to further use their gas reserves, switch fuels, and engage in demand-reduction measures where necessary. Higher than expected renewable generation has helped throughout April, but the current situation doesn’t appear to be sustainable.   

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