The UK gas market should brace itself for the impact of “volatile imports” for the rest of the year, according to a weekly market update from npower.

Commenting on the gas market’s twists and turns in the last week, Ben Spry Client Portfolio Manager at npower said: “The gas system was actually very well supplied towards the start of the week despite heavy exports to Europe ahead of the IUK’s (the EU-UK interconnector) maintenance.

“However heavy interjections into storage and also volatile flows from both Norway and Holland actually meant the gas system was pretty tight towards the end of the week and this supported prices,” he added.

He said an announcement from Gassco that Norwegian flows would be “severely affected” throughout the rest of the summer and all throughout winter ’13 “added significant premium to the market”.

For the rest of the years prices could depend on how the UK can “cope” with this volatility.

Mr Spry said: “Looking forward I think much will hinge on the UK gas system’s ability to cope with volatile imports as we go through the remainder of the maintenance season, with robust LNG flows and lower demand really trying to offset those inconsistent flows from Norway and the real need for us to re-inject into storage ahead of winter ’13.”

Find out the latest news on the energy market from Ben Spry, Client Portfolio Manager at npower in this weekly update.

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From one oil and gas hotspot to another – the UK airline bmi is launching new scheduled flights between Aberdeen in Scotland and Kristiansund in Norway. The first direct, scheduled air link between the two cities will begin at the end of August.

Aberdeen is one of Scotland’s major onshore bases for North Sea exploration while Kristiansund is the major oil and gas city on Norway’s mid north-western coast and oil companies such as Shell and Statoil have offices there.

Cathal O’Connell, chief executive officer of bmi regional said: “Our new Kristiansund route will link two important energy sector locations. Whilst we expect many passengers on the route to travel for business there are also established tourism and cultural connections between the North-East of Scotland and Norway, which we anticipate will result in additional leisure traffic.”

Tom Smith, chairman of Aberdeen City and Shire Economic Future (ACSEF) said: “There are strong synergies between both cities and the surrounding regions. This air service should be a catalyst for even greater commercial links, both with regard to work in the North Sea and collaboration between North-east and Norwegian companies in the global oil and gas market.”

Coal prices hit the lowest point they’ve been in more than two years last week, according to the weekly market report from supplier npower.

Magali Hodgson, Product and Services Optimisation Manager said: “On the curve, the bearishness [of power prices] came from weak coal prices… but coal prices hit the lowest they’ve been since April 2010 and went through their key support level of $90 a tonne.”

Outlining another key trend of the week, the supplier’s analyst explained the UK’s gas system was “comfortable”.

She said: “The comfortable gas system came about on the back of – even though [there was] very high export to the continent – an improved Norwegian flows with the maintenance starting to ease a little bit. End demand was lower as well on the back of warm temperature.”

The price of oil was “very volatile”, she went on: “Brent oil finished the week higher than where it started with plenty of conflicting news but actually that supported power and gas prices, so they didn’t go as low as they could have.”

Looking forward Ms Hodgson suggested mild temperature forecasts will “continue to limit demand” for power and gas, putting pressure on near term contracts along with the return of more coal and nuclear plants which are offline for maintenance at the moment.

Carbon also seems to be “mounting a recovery of sorts” ahead of the next EU vote on back-loading, she added.

To watch Magali Hodgson talk through the week’s energy trends, watch the Market Report here.

Lib Dem MP Robert Smith is taking over from Tim Yeo as chair of parliament’s energy and climate change committee (ECCC) while the Tory backbencher deals with allegations about lobbying which he strongly denies.

Sir Robert Smith was backed for the role of interim Chair unanimously by MPs on the cross-party committee yesterday.

In a statement, the ECCC said: “The Committee expressed confidence in Mr Yeo’s chairmanship of the Committee but accepted the recommendation in order to ensure the continued effective and evidence-based work of the Committee… Mr Tim Yeo will not be drawing a Chair’s salary during this time.”

The Lib Dem was recently involved in a spot of verbal jousting with Yeo in the Commons, asking why he didn’t push fellow Tory Chancellor George Osborne towards the decarbonisation target, according to the website TheyWorkForYou.

Smith prodded him on 4th June: “Given that the hon. Gentleman has chosen to reduce this issue to a political knockabout, it would be interesting to ask him, if he is so committed to his amendment, what meetings he has sought with the Treasury to discuss it.”

In reply, Yeo said: “I frequently pass the time of day in the warmest possible terms with my right hon. Friend the Chancellor of the Exchequer when we are voting in the same Lobby, which from time to time we are.”

Smith takes over while Yeo challenges claims he had a conflict of interest. However the Aberdeenshire MP has registered interests himself in British oil giant Shell.

In July last year he was given a ticket to London 2012 Men’s team Gymnastics by another oil firm BP which included a coach transfer and meals at the Royal Opera House worth a total of £750.

The Scottish Lib Dem has voted “very strongly” for laws to stop climate change, according to TheyWorkForYou.

According to his website Sir Robert Smith was manager of his family estate until he entered Parliament on his second attempt in 1997, winning the new seat from the Conservatives.

Currently he is Joint Vice Chair of the UK Offshore Oil & Gas Industry Group and during the 1997 Parliament he was a member of the Transport & the Environment team for two years.

Find out the latest news on the energy market from Magali Hodgson, npower’s Product and Services Optimisation Manager, in this weekly update.

If you are blocked from seeing this video and would like your own download, please email geoff.curran@energylivenews.com.

Wholesale energy prices in Ireland fell 5% last month.

Irish power firm Bord Gais which has 640,000 gas users and supplies more than 300,000 electricity customers released the figures in a monthly price report yesterday.

The Bord Gáis Energy Index – the firm’s average price for oil, gas, electricity and coal – fell 5% while the UK average monthly day-ahead wholesale gas price was at an all-time high for the month of May. The index showed that prices were also down by 4% compared to the value of the index a year ago.

John Heffernan, power trader at Bord Gáis Energy said: “Falls in all four of the fuel commodities that make up the Bord Gáis Energy Index resulted in a 5% month-on-month drop in the May Index. Irish wholesale electricity prices fell 11% and the UK Day-ahead wholesale price also softened.”

He went on: “Despite this, at 66p a therm, the UK average monthly Day-ahead wholesale gas price was at an all-time high for the month of May. The reasons for this were planned and unplanned Norwegian field maintenance, unseasonably cold weather and an aggressive push to refill storage stocks.”

In the oil market, the report notes month-on-month Brent crude prices fell $2 to $100. As for coal, the benchmark European contract price stood at $90.25 per metric tonne at the end of May and is “unlikely to fall much further” as it may trigger cuts to more expensive supply, according to the Index.

It’s worth noting the wholesale prices are distinct from the retail prices and Bord Gais told ELN it usually buys its energy on forward markets.

In an attempt to squeeze out as much economic benefit as possible from the region’s oil and gas, today the Government set up a review of the UK Continental Shelf (UKCS).

It’s the first time for more than 20 years the Government has commissioned such a review. Led by Scottish businessman Sir Ian Wood – reportedly Scotland’s second richest man who recently hung up the reins at North Sea exploration firm Wood Group – it will look at how to keep momentum in the sector.

So far around 41 billion barrels of oil and gas have been produced from the UKCS.

Energy Secretary Ed Davey said: “Our offshore infrastructure is getting older and we are seeing a decline in the rate of exploration and in the amount of oil and gas that is being recovered. All these issues need to be addressed if we are to stimulate innovation in this sector”.

Sir Ian Wood said he will have an eye out for what will “make a real difference to improving our economic recovery including optimising use of and extending life of infrastructure, production efficiency and maximising the use of key technologies.”

He went on: “The values involved in UK oil and gas are so large that even modest increases in key production metrics over time will deliver significant economic benefits.”

The initial conclusions from the review will be published in the autumn.

Twenty one protesters were sentenced yesterday for aggravated trespass after occupying a gas-fired power station last year.

Although none faced jail sentences, 16 of the climate activists were given community service orders of between 150-200 hours while the other five received 18-month conditional discharges.

They scaled the chimneys of EDF Energy’s newly built West Burton power plant in Nottinghamshire last October, with many strapped to a cooling tower for more then a week. Part of the No Dash for Gas Group, the activists said they were protesting against the Government’s policy to focus on fossil fuels rather than moving towards renewable energy.

More than 64,000 people signed an online petition in support of the protesters after EDF Energy launched a £5 million lawsuit against them which was later dropped following a public outcry.

On sentencing, the judge is believed to have said: “All of you are highly educated men and women, industrious committed individuals who work and volunteer in your communities. Your motives were genuine. What you planned, you executed to perfection.”

Speaking after the sentencing, Rachel Thompson, one of the protestors said: “Although – thank goodness – none of us are going to jail, we are still facing penalties for simply standing up for clean, safe and affordable energy. Meanwhile, everyone in the country will be facing a disastrously destabilised climate and rocketing fuel bills if we don’t stop the Government’s reckless dash for gas. The Government is putting the profits of the Big Six energy companies before the fundamental need for a safe and liveable climate for generations to come.”

Find out the latest news on the energy market from Magali Hodgson, npower’s Product and Services Optimisation Manager, in this weekly update.

If you are blocked from seeing this video and would like your own download, please email geoff.curran@energylivenews.com.