How wholesale gas and prices are moving
Business Energy Prices - Commodity Report
Business energy prices are constantly changing. We monitor gas and electricity markets, so we can take advantage of when it may be a good time for customers to buy
Get the latest updates on wholesale business energy prices
Commodity Market Graphs
Gas and electricity commodity prices continue to climb and the market remains bullish over the next few months – i.e. the fundamentals may suggest prices will remain high for at least a while longer.
Why are business energy prices increasing?
- Colder than average weather during April and May.
- This has resulted in using gas storage to balance demand.
- Gas storage has been depleted and now is at similar levels to those seen in 2018 (after the Beast from the East).
- Because of this we will need to inject more gas back into storage during the summer keeping demand higher than usual.
- Heavy gas field maintenance in the North Sea.
- Strong economic growth – the UK manufacturing and services sector grew at their fastest rates in decades during May.
- Increasing oil prices on the back of the economic growth and tight supply.
- High LNG (liquefied natural gas) prices – trading at their highest levels since Jan-2021 due to strong demand and low storage levels.
- Carbon prices are also trading at record highs after the EU and parliament agreed to cut emissions by 55%, a much tougher goal that the existing 40% target.
When should I buy?
Market fundamentals remain bullish for the next few months and commodity prices are still moving upwards. Carbon continues to break new ground with some forecasts placing costs at 130 €/tonne by 2030. It is now trading at 48 €/tonne which is significantly more than the 25 €/tonne seen back in November.
If your contract starts soon it may be worth jumping in now as it seems unlikely you will save much money by holding on, with the added risk of having to spend more if markets continue to rise.
If you contract starts towards the end of the year, then its a difficult choice. At the very least you should track the market and have a ceiling price in mind, minimising your risk. Alternatively, if you have a large energy spend you could consider a flexible purchasing supply contract allowing multi buying decisions, spreading the risk even further.
We can help track markets, plan budgets, secure and manage flexible buying contracts. If you need further guidance, please get in touch.
Things which may impact business energy prices moving forwards
Slower economic recovery due to COVID-19
Warmer weather in Q3/Q4
Increased supply, including LNG, solar and wind
Slow economic recovery
Strong carbon prices
Greater injection required into storage
Low LNG imports and wind generation
Strong economic recovery