8th October 2024 Energy Price Alert – UK Gas & UK Electricity
On Monday wholesale Gas and Electricity prices gave up some of their gains of the last few days as (our often lauded) market fundamentals of oversupply, good stock, weak Chinese demand, warm weather and strong £ kicked in.
We expect the Winter to be riddled with spikes like we saw, but overall for the market to settle in the Spring/early Summer to around 10% below where it currently is, which will be good news for next year’s renewals. That said, current prices remain very competitive compared to those seen in the past eighteen months.
Gas: Gas prices softened yesterday with ample supplies and demand performing as expected. An increase in wind generation helped ease prices in the prompt. Medium range storage facilities are currently 68% full, with the expectation of additional gas supplies to be injected into storage.
Power: Power prices softened yesterday, tracking losses in the gas and carbon markets. An upward revision of wind generation to 11.1GWs/day helped drive prices downwards in the prompt. Price losses were limited due to the expectation of a rise in demand for heating.
Oil: Oil prices continued to gather strength yesterday as concerns surrounding the widening conflict in the Middle East would disrupt supplies throughout the area.
Carbon (EU ETS): The ICE Dec-24 fell to €61.76/t yesterday. The contract is currently trading slightly down at €61.41/t.
Carbon (UKAs): The ICE Dec-24 continued to slide down to £35.29/t on yesterday. The contract has opened stronger at £35.42/t this morning.
