Wholesale gas and electricity prices continued to rise on Thursday, as a result of geopolitical issues, mainly now the Ukrainian advances into Russia. The main concern of the markets, bizarrely, is that damage will be caused to Russian gas pipelines even though we no longer use them. Our feeling is that there will continue to be volatility for the next week or so until this latest situation de-escalates.
On the generation front, there was very good news, with renewables contributing 47% and fossil fuels being below 15%. This meant that the generated price dropped below £50/MWh.
In the retail markets, prices have increased over the week, mirroring the wholesale movements. As soon as the geopolitical situations in Ukrain/Russia and the Middle East abate we expect the market fundamentals to kick back in and are still forecasting drops in both gas and electricity over a rolling 12 month period.
If you would like to discuss your individual situation please contact me on 07768 421 901, or do feel free to email me at this address.
| Gas: Gas prices gained yesterday. The UK expects zero LNG cargoes until 23 August, down from three cargoes over the same period last year. Markets continue to monitor the conflict in the Kursk region as any damage to the gas infrastructure will influence prices. Power: Power prices rose across most of the curve yesterday, tracking the wider energy complex. High wind generation saw prices fall in the Day-ahead contracts. Oil: Oil prices extended their gains from yesterday as tensions surrounding Russia and the Middle East worried the market. Global oil stock depletion showed a tightly supplied outlook. Carbon (EU ETS): The ICE Dec-24 continued its recent climb and settled at €71.06/t yesterday. The contract is currently trading at €71.44/t this morning. Carbon (UKAs): The ICE Dec-24 rose to £38.59/t yesterday. The contract is trading at £38.74/t at the time of writing. |
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