Latest energy news - this week’s main points

On Thursday the UK energy markets started to rise again after recent falls, this was driven by a tighter supply picture as the Norwegian Kollsnes gas processing plant goes offline due to unplanned maintenance. Against the backdrop of ongoing supply concerns surrounding Russia, the unplanned drop in Norwegian output added further pressure to the curve. A continuation of strong imports of Liquefied Natural Gas (LNG) has offset some of the rises, with European prices remaining firmly above the Asia market prices, ensuring cargoes travel Westward for the time being. However, this highlights the impact of greater reliance of LNG, which typically comes at higher cost than pipeline gas. As Europe diversifies supplies away from Russia, countries are likely to increasingly rely on LNG over pipeline gas, providing rising pressure to the curve.

The European commission is working to increase the availability of alternate energy supplies to try and cut the cost of banning Russian oil imports. None of the measures have been formally proposed and nations have different positions on them. Germany is the most reluctant of an oil embargo due to their strong dependence on Russian oil, which a ban on could cause strong economic backlash. Although persuading Germany to get on board would also shift the position of other reluctant countries to follow suit. Work is under way to assess the cost of replacing Russian oil and to arrange national deals for quick alternatives. This provides upside risk to the oil markets as quicker alternatives may prove more costly, though the market will continue to receive direction from any news of a Russian oil embargo.

Dukefield Energy understands that this is a very hard time for customer looking at their energy contracts, given the fluctuations in the market. If anyone has any concerns or just wants some advice, please don’t hesitate to contact us.

We are also exhibiting at next week’s Schools and Academies Show at London’s Excel, we will be on the CPL Group Village. If anyone would like to pop by for a chat or some information, please get in touch or drop by the stand.