I know what most of you will be thinking, because of the wonderful summer weather Britain has had over the past month, that gas prices will be at an all-time low and it’s a great time to secure your next gas contract. The theory is good but unfortunately, it’s not the case.
UK Gas prices have actually continued to climb slightly this week from last. In fact, gas prices are currently the highest they’ve been since late May 2018.
Although domestic gas consumption has drastically reduced due to the swelting weather, gas prices have held due to an increased load on gas to generate electricity for air conditioning. So in simple, the weather is a little bit too good.
Oil prices firmed to a 4 year high following an OPEC meeting in Vienna. It was widely expected that an extra 1 million barrels a day would be produced by OPEC nations, however, it seems this figure is unlikely with the US sanctions on Iran. The market has risen further to $78.13 due to supply outages in Libya due to an armed standoff.
Coal prices continue to climb, reaching above $90bbl, up from $85 in recent days. This has been driven by the increased demand for electricity as Europe swelters in a heatwave.
Carbon prices have risen from €14 to price back above €15.20 which has helped contribute to further gains on the curve.
All in all, gas prices have been bullish for the week, helping prices increase across all parts of the UK curve.
If your contract is currently due for renewal and you’re unsure when is the best time to buy, get in touch with the team for some free advice.