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Energy Markets
01.05.2026
Energy markets continue to be driven by geopolitical tension, with the closure of the Strait of Hormuz keeping oil supply tight in the short term. While some Iranian production has been temporarily shut in, it’s unlikely to cause long-term damage meaning output could return relatively quickly once disruption eases. That said, the current market structure points to immediate scarcity, with prices expected to remain firm and potentially rise further into May if the situation continues.
Looking ahead, the bigger concern is what comes next. Markets are starting to price in a longer period of disruption, and while prices are already elevated, the full impact on businesses and consumers is likely still to come. As inventories fall, fuel availability could tighten further over the summer months, with historical trends suggesting a lag before the wider economic effects are fully felt.
Across global regions, we’re seeing very different pressures play out. In Asia, extreme heat is pushing electricity demand to new highs, leading to power outages and highlighting weaknesses in infrastructure. Meanwhile, in the UK and Europe, there’s a growing focus on making better use of renewable generation, including shifting demand to areas with stronger supply. In contrast, parts of the US are seeing increased flexibility in their energy systems, helping to ease pressure on capacity.
The key takeaway is that energy markets are no longer moving in isolation, they’re increasingly shaped by global politics, infrastructure challenges, and security concerns. With risks continuing to build, the market is moving beyond short-term price volatility into a more prolonged period of uncertainty. For businesses, staying close to the market and planning ahead has never been more important.