Short-term electricity and gas prices remain high because of low LNG imports, price increases in oil and low renewable energy generation.
Political issues with Russia and the construction of Nord stream 2 have also been affecting gas prices and storage levels.
Carbon Spot Prices
Carbon prices have been more volatile than in previous months which has continued to impact on electricity and gas prices. Whilst prices have traded consistently above €50, they have reduced from the highs seen last month. View here for details on the carbon market.
Short-term electricity prices remain extremely high, with winter 2021 prices trading between £90-£97.
Poor weather conditions have impacted on renewable energy generation with wind contributing to just 4% of output from the expected 15-20%. Overall renewable generated 30% of the mix, whilst fossil fuels are averaging 57% leaving the remaining to nuclear.
We saw a large fall in price between 05/07- 07/07 due to carbon falling by €6.7 p/tonne, however this was short-lived and quickly retraced upwards to the levels we are seeing today.
UK gas prices have been relatively strong and trading above 90p/therm (W21) and 55 p/therm (S22) partly because of low gas storage levels driving up demand.
Maintenance of Nord Stream 1 has now been completed, supplying 160mcm of gas back in the market from Russia to the EU. A deal has also been made between the US and Germany to end the dispute over Russia’s Nord Stream 2 which should increase gas flows further over coming months.
Oil saw bearish movement of $76.49 to $68.20 during the month following an announcement from OPEC who are increasing production of 400,000 barrels per month. This week we saw prices retrace back to normal levels of $74.10.
Petrol prices have climbed to the highest level in almost 8 years, due to inflation in the UK reaching 2.5%. The average cost for petrol has hit 133p a litre making it 20p higher than November, reaching the highs of October 2013. Petrol prices at eight-year high, says AA - BBC News