Energy Market Update 27/01/2026

Welcome to our weekly energy market update, where we share the latest trends, shifts, and key developments impacting the energy sector. Whether it’s fluctuations in oil and gas prices, changes in renewable energy policies, or updates on energy infrastructure projects, we’re here to help you stay informed. Join us as we break down the most important factors influencing the market this week, and explore what these changes could mean for your business.

Current Market Drivers:

📉 EU storage levels have fallen to 45% full, 15% below the five-year average, supporting buying pressure. Alongside this, further reinforcing bullish sentiment is a shift in investment funds from net short positions in gas futures around the end of 2025 to net long positions.

💵 The UK economy is showing signs of recovery after confidence following the Nov-25 budget has improved, after months of uncertainty, with consumer confidence reaching its highest level since Aug-24

🕊️ Despite trilateral peace talks between Russia, Ukraine, and the US in Abu Dhabi, a workable peace deal has yet to materialise. At the same time, Ukraine continues to endure sustained Russian bombardment, with damage to energy infrastructure suggesting that a humanitarian catastrophe is imminent, according to DTEK’s CEO.

📉 The IEA forecasts that overall European gas demand will decline by 2% in 2026, driven by the expansion of renewables, which is expected to reduce gas-fired generation demand in the power sector by 12%.

🌍 In 2025, wind and solar generation in the European Union surpassed fossil fuel generation for the first time, contributing 30% of the power mix, with solar output growing by more than 20% and overtaking both coal and hydroelectric output, signalling a reduction in fossilfuel reliance.

🤝 Trump has reversed his threat to impose 10% tariffs on several European countries and the UK

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