Headlines:
- Gas and Electricity Wholesale prices are lower than last week
- EU Gas Storage levels are a very high 99% full
- Global events may create further price volatility
Energy Overview
Gas and Electricity Wholesale costs are lower. Little has changed over the last week with the same factors continuing to give both confidence and concern for winter Gas and Electricity supplies.
EU Gas Storage remains high at 99% full and in a good position to support the additional demands for heating through the colder spells, when it is expected Gas will need to be withdrawn. LNG deliveries continue to arrive which help to offset the reduced flows of Russian Gas. In the event of a supply emergency, the Groningen Gas field could be made available for one more year.
The use of Gas for generation increased to 36% of Electricity supplies with Wind at 26%, although two days saw just 5%, requiring additional contributions from other sources, including Coal. Imports of Electricity from the continent remained high at 11%, slightly down on recent weeks. The availability of imports from the likes of France with their considerable Nuclear assets and Hydro from Norway, will be important in balancing the system, but these are not always reliable.
The conflicts in the Middle East and Ukraine may still have unknown consequences. There is the potential that as tensions grow due to the military action in Gaza, that other nations in the region may take action, threatening the flow of Oil and Gas and impacting on global energy prices. There could also be further Gas supply reductions from Russia. In order to manage risk, Indigo Swan are advising customers with contracts that end in 2023 and early 2024, to engage with us to review their positions.
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