Prices across power and gas have continued to drop through March, helped by the above average temperatures and windy weather that we have experienced in the UK. This is in stark contrast to the prolonged cold weather this time last year. As a consequence, gas consumption has dropped and storage levels are very healthy for this time of year. With gas storage already at good levels, the normal summer replenishment for Winter 2019 usage will not be so pronounced, putting further downward pressure on gas and thus power in the coming months.

Whilst all power and gas costs are falling, there are steeper reductions in the near contracts than later Annuals. As such, 2019 prices are now at a discount to 2020. This is of course due to the abundant gas at present but also down to the bullish effect of stronger oil on future Annuals.

Back