We understand the business energy market has been very challenging as of recent.

Our specialists compile a Market Drivers report each month.

We have highlighted Bearish drivers, expected to contribute to the market lowering, and Bullish drivers, expected to contribute to the market going higher.

Bearish Drivers

– Warmer Weather forecasted until mid-November
– Ample LNG cargoes into the UK
– Strengthening of sterling with the new UK PM
– Good wind speeds reducing gas for power demand

Bullish Drivers

– Uncertainty surrounding gas levels through winter
– Ability to fill storages in 2023 with lower Russian Gas
– Increasing gas demand from China following lifting of restrictions

October finally saw a change in direction for markets with prices towards the end of the month selling off hard with softer fundamentals taking control and establishing much needed relief for end users.

Amid record high wholesale prices, the UK Government announced that they would be stepping in to assist businesses over winter with rising wholesale costs. The announcement was in the form of the EBRS (Energy Bill Relief Scheme) which has been implemented to assist customers who took out supply contracts after the 1st December 2021. The relief saw swings in market prices as volumes were taken off the market due to consumers placing contracts at the last minute in order to meet the requirements.

Later on in the month, softer fundamentals took control resulting in the perfect storm for gas & electricity prices. Wholesale prices fell with day ahead prices even trading sub £100 / MWh & p/therm. Due to recent announcements, ample LNG cargoes, higher than normal seasonal temperatures and ample wind all help weigh down on price.

Looking forward, the short term market seems relatively comfortably to continue dropping with the above mentioned drivers. Having said this, we are firmly in the winter season now and any reforecast to weather temperatures will no doubt be bullish for markets. The threat of the war in Ukraine also looms over the markets and it is unlikely we will see any major relieve while ever this is going on.