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Weekly Wholesale Energy Market Update - UK Energy & Oil Markets - 09/10/2023

Your Weekly Guide to UK Energy Markets

snapshot of wholesale market movements

Welcome to The Smart Energy Company's Weekly Wholesale Energy Market Report, your go-to source for the latest insights and updates on UK energy markets. As an energy brokerage company, we understand the importance of staying informed about the changing trends in the energy market. That's why we provide these weekly market reports, to help businesses like yours make informed decisions when negotiating your next energy contract.


Weekly Wholesale Energy Market Movements: 02/10/2023 to 09/10/2023

Week Ending on 09/10/2023

This week, the energy markets experienced a rollercoaster of changes, influenced by a variety of factors like weather, supply dynamics, and local demand. Here's a detailed look at how the week unfolded:

Start of the Week:

The week kicked off on 2nd October with gas prices at 83.50p/th and electricity prices at £67.00/MWh.

Midweek Movements:

By the 4th of October, gas prices had dropped to 80.70p/th, a decrease of about 3.4%, while electricity prices increased to £75.50/MWh, a rise of about 12.7%. The decrease in gas prices was likely due to increased Norwegian supply and milder weather conditions. The increase in electricity prices could be attributed to market participants taking advantage of low pricing to secure their positions.

Week's End:

The week wrapped up on 9th October with gas prices at 90.50p/th, an increase of about 8.4% from the start of the week. Electricity prices also rose to £86.50/MWh, a significant jump of about 29% from the beginning of the week.

Key Factors Influencing the Weekly Wholesale Energy Market:

  • Gas Supply: Increased Norwegian flows and high storage levels had a significant impact on gas prices this week.

  • Weather: The prospect of cooler temperatures later in the week likely influenced both gas and electricity prices.

  • Local Demand: An increase in local demand towards the end of the week, possibly due to anticipated cooler temperatures, also played a role in the price movements.

Graph of the Last Week's Movements:

Let's take a visual look at the past week's gas and power market movements

graph to show last weeks wholesale market movements
snapshot of wholesale market movements

Forecast for the Upcoming Week: What to Expect in the Energy Market:

  1. Oil Price Surge: The 4% jump in oil prices could have a ripple effect on gas prices, as oil and gas are often correlated. Higher oil prices can make gas more expensive to produce and transport, potentially driving up wholesale gas prices.

  2. Geopolitical Tensions: The ongoing conflict in Israel and Gaza could lead to increased volatility in the energy markets. Traders might hedge against risks by buying more contracts, which could drive up prices in the short term.

  3. Global Supply Concerns: The Middle East accounts for nearly a third of the world's oil production. Any disruption in this region could lead to concerns about global energy supply, potentially affecting both gas and electricity prices.

  4. Market Sentiment: Geopolitical tensions often lead to uncertainty, which can make energy markets more volatile. This could result in short-term price spikes, even if the fundamental supply and demand factors remain unchanged.

  5. Interconnected Markets: The energy markets are interconnected. A surge in oil prices could lead to increased costs for electricity generation, especially in regions where oil-fired power plants are significant.

Given these factors, it's reasonable to expect that the ongoing conflict could introduce a level of unpredictability and potential upward pressure on both gas and electricity prices in the coming week.


Table of the Movements on Each Day in the Last Week:

Here's a detailed breakdown of the daily changes in gas and electric prices over the past week:


Gas (pence per therm)

Electric (£ per MWh)























Weekly Oil Market Summary:

The week in oil markets was marked by a series of fluctuations, influenced by macroeconomic factors, geopolitical tensions, and supply-demand dynamics. The week started with Brent crude futures at $95.31 per barrel and WTI crude at $90.97 per barrel.

Start of the Week:

On 2nd October, oil prices settled 1% lower due to macroeconomic concerns and profit-taking. However, they rose about 30% in the quarter, primarily due to OPEC+ production cuts.

Midweek Movements:

By 4th October, Brent crude futures recovered slightly to $90.92 per barrel after a significant drop. The market was influenced by Russia and Saudi Arabia's decision to extend output cuts and the strong U.S. dollar.

Week's End:

The week concluded on 9th October with Brent crude experiencing its highest weekly losses since March, despite geopolitical tensions in the Middle East adding a new layer of uncertainty.

Key Points:

  1. OPEC+ Decisions: The extension of output cuts by OPEC+ members like Russia and Saudi Arabia continued to exert bullish pressure on oil prices.

  2. Macroeconomic Factors: High interest rates and a strong U.S. dollar contributed to downward pressure on oil prices.

  3. Geopolitical Tensions: The conflict between Israel and Hamas added a new layer of risk, likely supporting oil prices and increasing market volatility.

  4. Supply and Demand: Weak petrol demand in the U.S. and high interest rates globally are affecting the demand side, while OPEC+ decisions are keeping the supply tight.

Forecast for the Upcoming Week:

The upcoming week is expected to be influenced by several key factors:

  1. Geopolitical Risks: The ongoing conflict in Israel and Gaza could introduce volatility and potentially drive up prices.

  2. Interest Rates: Continued high interest rates globally could slow economic growth and reduce oil demand.

  3. Supply Constraints: OPEC+ decisions to maintain production cuts will continue to influence the supply side.

  4. Global Economic Indicators: Investors will be closely watching economic data, including U.S. jobs data, to gauge the potential impact on oil prices.


12-Month Graph to Show the Movements Over the Last Year

Now, let's zoom out and take a look at the long-term trends in the energy market over the past year:

graph to show last 6 month wholesale market movements


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