Wholesale energy prices update 24/02/17
Price Drivers and OutlookLast week saw a lot of volatility in wholesale gas and electricity prices, but trading closed relatively unchanged compared to where it opened. Energy prices rose initially as oil prices drifted upwards, European weather forecasts cooled slightly and other commodities like coal increased in price. These price increases were corrected in the middle of the week when oil shed its value in response to US storage changes. Traders are betting heavily that oil prices will continue to increase, but the OPEC production cuts continue to be offset by rising production in other parts of the world. This week at least, Brent crude remained almost unchanged at $55.99 a barrel.
UK energy pricesUK energy prices increased for two days as unplanned outages in Norway gas systems, but the UK gas system stayed long as storage was released. Gas prices tumbled on Wednesday in line with the oil market and as warmer forecasts were released for March. Electricity prices tracked the prices of gas and coal. They were also eased by good renewable generation from Storm Doris. Prices didn't change much over the week. A warmer March forecast reduces the risk of cold weather price spikes. But with an important announcement about the UK's largest gas storage facility, Rough, expected shortly, prices could see some sharp movement. Prices may still come down before April renegotiations, but you may want to take advice on contracting now to avoid future volatility. For more information and advice please contact one of our account managers today. Call: 0800 043 0423.
Published by Utility Helpline on (modified )
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