Top Factors and Challenges in the Energy Market for September 2019
The Cause of Low Prices
Fair weather suppressing demand, a continuous strong contribution from solar and wind, a comfortable European wide gas stock situation, and a healthy flow of LNG cargoes into the UK from Qatar responding to lower demand from Asia, have all combined to produce spot wholesale prices now flirting at 18 month lows.
The Impact of Winter
As ever with the imminent start (1st October) of the winter pricing season potential headwinds can be prompted by unplanned North Sea/Norway pipeline maintenance, but as things stand, wholesale energy costs look an attractive proposition in distinct contrast to this time last year. For anyone with contracts renewing in Q4 19 or even into Q1 20 this is a good time to take advantage of low prices.
Tensions in The Middle East
Although US crude stockpiles fell more than anticipated in August, Russian oil production rose to the highest level achieved since March 19. Other OPEC producers also increased output during the month. Tensions remain high in the Middle East after the recent Iranian seizure of a number of tankers in the Strait of Hormuz.
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These are just a few examples of global insights which are directly effecting the energy market and in turn the money you pay for energy. Our latest energy report provides further detail on these topics and helps to explore what this can mean for your business and energy needs.
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