August 19, 2009 1:27 pm
Although wholesale energy prices were at their lowest level for 21 months only 3 weeks ago, they have since increased slightly. Hence, now is the time to look at your next energy contract(s).
Even if your energy contracts are not due for renewal until next year, it is still worth putting a framework in place that allows you to make purchasing decisions now should prices move up.
As well as purchasing gas and electricity on a fixed or flexible basis, we also provide the following tailored services:
We derive our fee by a brokerage commission which typically equates to 1% of your energy spend. We are completely transparent on what we charge.
Market Overview
Base-load prices have increased around 3% for annual October 09 contracts since our last message three weeks ago. Prices further out along the power curve have risen slightly, helped in general by stronger gas prices although trading has been very thin past the front 3 months. A 9% increase in Brent crude oil prices since close on Wednesday 22nd July 09 has also compounded these increases. Unusually, the premium between the next winder and summer contracts has eroded to less than £1/MWh. A year ago it was £10/MWh.
Prompt prices have remained around the low £30/MWh on healthy margins. The Met office predicted above seasonal temperatures during August – this has not happened meaning we are now unlikely to see price spikes as a result of increased demand from air conditioning load.
Gas: Winter 09 Cheaper than Summer 10?
Winter 09 prices are cheaper than Summer 10. Could LNG be the difference? With LNG now accounting for a large % of the UK supply increasing attention is paid to the US gas price as much of the LNG delivered to the UK is from Atlantic Basin market. US prices have dropped below UK for all future periods and this is leading to speculation of lower prices for the forthcoming winter.
Prices further along the curve are still showing a relative premium on Winter 09, now valued at almost 14p/therm above – a record level.
Day-ahead prices have been floating around 23–24p/therm despite significant variability in gas flows into the UK although demand is down around 10%.
What To Do Next
Call us on 0121 222 5617 to speak to one of our professional, local Optima Service team.
Our friendly team will provide an overview of your current gas and electricity supplies and offer a FREE, NO OBLIGATION proposal to identify potential financial savings.
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Optima Energy Management
Griffin House
Broughton
Skipton
North Yorkshire
BD23 3AN
tel: +44 (0) 1756 702 488
fax: +44 (0) 1756 702 489
Innovation Centre
1 Devon Way
Longbridge Technology Park
Birmingham
B31 2TS
tel: +44 (0) 121 222 5617
fax: +44 (0) 121 275 6101
email: info@optimaenergy.net