Gas and power prices still low – Y report

UK gas and power prices are still at the bottom of the market, according to Inenco’s Y report. They have been driven by temperatures which have increased demand. In terms […]

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By Jacqueline Echevarria

UK gas and power prices are still at the bottom of the market, according to Inenco’s Y report.

They have been driven by temperatures which have increased demand.

In terms of supply a new gas field operated by Total has started production in the North Sea.

Dorian Lucas, Energy Trader at Inenco added: “The volatility that we’ve seen in crude oil prices has basically put prices up from the 13-year lows we saw few weeks ago.”

Customers looking to place a fixed price contract could achieve “quite a good” price.

However, he said: “There is scope for losses going forward and it is down to you really on your appetite to risk…. But we are in winter and we are seeing revisions to temperature forecasts which are pointing upwards with incentives on prices.

 

“We’ve seen more generation go offline for power and going forward this is going into the mix and potentially we’re going to see prices rise.”

However if businesses “want to sit on your hands” a better price could be achieved, Mr Lucas believes.

For customers looking to place flexible contracts with high hedges “there’s no real incentives in taking more volume at the moment” as there could be potential further losses, according to Mr Lucas.

He went on: “However if you’ve got relatively high exposure you might want to move into the market and take a little bit, just as a bit of risk mitigation, going forward.”