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Weekly Wholesale Energy Market Update - UK Energy & Oil Markets 17/06/2024

Welcome to our 'Weekly Energy Market' update, where we dissect the latest trends and changes from 10th June to 17th June 2024. Your guide through the fluctuations of the last week: revealing trends, insights, and forecasts in the UK energy and oil markets.

image to show how much the energy market has moved in the last week

Weekly Energy Market At A Glance


Gas Market Overview


The gas market experienced notable fluctuations throughout the week. Here's a summary of the key movements and factors influencing the market:


  • 10/06/2024: Gas prices were steady at 78.2p/th. The recovery of gas flows from Norway helped ease supply worries.

  • 11/06/2024: Gas prices jumped to 82.6p/th, influenced by market sentiment rather than actual supply changes.

  • 12/06/2024: Prices slightly dropped to 82.0p/th as demand decreased with better weather conditions.

  • 13/06/2024: Prices increased to 83.8p/th due to planned maintenance at a major terminal and other supply concerns.

  • 14/06/2024: Prices stayed at 83.8p/th, with stable supply and demand balancing the market.

  • 17/06/2024: Gas prices remained at 83.8p/th. Concerns about disruptions in Ukraine were calmed by stable gas flows.


Power Market Overview

Electricity prices showed similar patterns influenced by gas prices and weather:


  • 10/06/2024: £73.75/MWh

  • 11/06/2024: £84.00/MWh

  • 12/06/2024: £79.00/MWh

  • 13/06/2024: £71.00/MWh

  • 14/06/2024: £84.50/MWh

  • 17/06/2024: £83.50/MWh


 

Key Influences:


This week's energy market was shaped by a combination of factors impacting both gas and power prices:


  1. Supply Recovery: The resolution of the Sleipner platform outage and restored Langeled flows helped alleviate supply concerns early in the week.

  2. Market Sentiment: Mid-week price increases were driven by market sentiment rather than substantial changes in supply or demand.

  3. Weather Conditions: Fluctuating wind speeds and temperatures played a significant role, affecting both gas demand for power generation and overall electricity demand.

  4. Maintenance Schedules: Planned maintenance at key terminals, such as the Easington Dimlington terminal, influenced the market by altering supply dynamics.

  5. Geopolitical Concerns: Concerns over potential disruptions in Ukrainian gas infrastructure influenced market stability.


These combined factors contributed to the observed trends and movements in gas and power prices throughout the week.

 

How Does This Compare to Last Week?


Gas Market Comparison:


  • Last Week (3rd June - 10th June 2024):

  • Gas prices ranged between 83.5p/th and 79.2p/th. The average price was 82.64p/th.

  • Influences: Supply uncertainty due to Nyhamna outage, recovery of Langeled flows, and fluctuating gas-for-power demand.


  • This Week (10th June - 17th June 2024):

  • Gas prices closed at 83.8p/th with less volatility.

  • Average price: 83.87p/th.

  • Influences: Stable supply, market sentiment, and planned maintenance at key terminals.


Power Market Comparison:


  • Last Week (3rd June - 10th June 2024):

  • Electricity prices varied between £66.00/MWh and £80.00/MWh. The average price was £73.06/MWh.


  • This Week (10th June - 17th June 2024):

  • Electricity prices were more stable, closing at £83.50/MWh.

  • Average price: £79.29/MWh.

  • Influences: Gas price changes, renewable energy output, and local demand dynamics.


Summary: This week, both gas and electricity prices increased compared to the previous week, indicating a more expensive market environment. Gas prices averaged higher due to stable supply and ongoing maintenance, while electricity prices saw a notable rise influenced by gas prices and renewable energy output. These higher prices may be a concern for customers looking to renew their contracts, as the market becomes more costly.


 

Market Forecast for the Upcoming Week


Next week, expect the following:


  1. Stable Supply: We expect stable gas flows and fewer disruptions.

  2. Renewable Energy: Higher wind speeds might reduce the need for gas in power generation.

  3. Geopolitical Events: Ongoing events, especially in Ukraine, might impact prices.


We anticipate some stability in prices due to better supply conditions and increased renewable energy output. However, keep an eye on maintenance schedules and geopolitical events.

 

Weekly Oil Market Summary: 10th June - 17th June 2024


This week saw varied movements in the oil market influenced by economic data, geopolitical events, and market sentiment:


  • 10/06/2024: Brent crude settled slightly lower at $79.62/barrel due to investor concerns about interest rates and economic growth.

  • 11/06/2024: Brent surged to $81.63/barrel, driven by hopes of increased summer fuel demand.

  • 12/06/2024: Prices edged up to $81.92/barrel following positive demand forecasts from the U.S. Energy Information Administration.

  • 13/06/2024: Brent rose to $82.60/barrel amid Middle East tensions and limited expectations for U.S. rate cuts.

  • 14/06/2024: Brent settled at $82.75/barrel, supported by OPEC's demand growth forecast and U.S. labor market data.

  • 17/06/2024: Prices slightly decreased to $82.62/barrel but showed a weekly increase of 4%, reflecting strong demand forecasts and stable interest rates.


Overall, oil prices fluctuated with significant weekly gains due to strong demand forecasts and stable supply conditions.


Key Influences


  1. Economic Data: Positive U.S. jobs data and the Federal Reserve’s stance on interest rates impacted market sentiment.

  2. Geopolitical Events: Middle East tensions and OPEC+ decisions influenced price movements.

  3. Demand Forecasts: Upward revisions in global oil demand forecasts from the EIA and OPEC supported prices.

  4. U.S. Dollar Strength: A stronger dollar influenced oil prices by making it more expensive for holders of other currencies.


Market Forecast for the Upcoming Week


Looking ahead, several factors will influence the oil market:


  1. Economic Indicators: Continued monitoring of U.S. economic data and Federal Reserve announcements will be crucial.

  2. Geopolitical Developments: Ongoing tensions in the Middle East and any changes in OPEC+ production policies will impact prices.

  3. Demand Trends: Seasonal demand increases and updated forecasts will play significant roles.

  4. Supply Conditions: U.S. inventory levels and rig counts will continue to be key indicators to watch.


Overall, the market may see continued volatility with a potential for further price increases if demand forecasts remain strong and supply remains stable.


 

Advice for Your Business

For advice that fits with the latest market situation, get in touch for a free business energy quote. Our team at the Smart Energy Company is ready to help you make informed choices, tailored to the market’s current state.

 

Get Your Free Business Energy Quote Today


Keep visiting our blog for weekly updates. If you have any questions or need more detailed advice, we’re just a call away. We’ll help you navigate through the market changes with ease and confidence.





Or Call us on 0151 459 3388


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