Energy Market Update – November

Since our last Market Knowhow Report, Gas and Electricity Wholesale prices have seen small increases. Oil is up to $62 a barrel, due to a more positive message concerning the US and Chinese trade talks, the expectation being that global economic growth would improve, and with it, demand for Oil. Also, OPEC and Russia may further increase and lengthen production cuts, to stimulate prices.

Good deliveries of LNG have enabled us to maintain high Gas Storage levels, with Medium Range facilities being full. This is a positive position as temperatures fall and heating demand increases. Wind’s contribution to generation is down on recent months, whilst more expensive Coal is up, to
meet additional demand.

The general election is on the 12th December. Should the Conservatives win, there would likely be little change to Wholesale prices, whereas a Labour victory could see movement in either direction, due to their nationalisation of utility companies and taxation plans.

The Met Office forecast is for unsettled weather over the next couple of weeks. Some regions are likely to see below average temperatures with night frosts. Wholesale prices for 12, 24 and 36 months are still looking very competitive. With colder weather and the general election, it is worth getting in touch to discuss the options for all 2020 contracts.