The Aug 2021 Gas price rose 1.2% to 90.02p/therm last week, reflecting ongoing low supply from the UK’s LNG terminals, unplanned pipeline maintenance outages and strong demand from the power sector led by an boost in air conditioning on the Continent.
Just one LNG tanker is currently scheduled to arrive in Britain during July.
The Oct 2021 12 Month Gas price rose 2.4% to 77.20p/therm as European gas storages are still only 51% full. This continues to be the largest supply risk ahead of the colder winter period.
The Oct 2021 12 Month Power price saw an increase of 0.4% to £81.09/MWh, tracking gas prices higher even though a notable drop in carbon prices offset some of the sentiment.
Prices for both gas and power are also being driven higher by increased tender activity in the run up to the 1 Oct renewal date.
1 Oct is the most popular date for businesses to renew their energy supply contracts, meaning the months of July, Aug and Sept are the busiest in the industry. Any clients who haven’t yet secured their new contracts will all be asking suppliers for prices at the same time, driving prices even higher.
Though energy prices are already at record highs, it is widely expected that prices will remain high for the next three months, meaning any clients with open volume in 2021 should be locking out their contracts as a matter of priority.