State of the Energy Market – 6th July 2022

Daily Updates

On Tuesday evening (5th July), the Norwegian government decided to intervene in the energy sector strike forcing through a settlement, which put an end to all industrial action. This was welcomed by the energy markets this morning and we saw August 22 gas drop by 40p per therm and August 22 power fall by over £20 per MWh. Curve prices were also showing reasonable drops.

However, as the we moved into the afternoon, the bearish sentiment began to be eroded away and prices started to drift upwards. Curve prices are looking to close at near neutral levels, but prompt prices are still likely to close with a discount of 5% compared to Tuesday’s close.


August 22 wholesale gas prices gas prices increased by 2.9% to close at 290.43p per therm.


August 22 wholesale power prices increased by 1% to close at £265.07 per MWh

In other energy related news:

  • The German government has made legislative changes that will enable it to bailout failing utility companies should they wish. The changes under the Energy of Security Act will enable the government to stabilise energy companies that face financial troubles, thereby avoiding a domino effect that would eventually hit German customers. It also includes a mechanism to share costs of rising gas prices equally among all consumers should the current rise in wholesale gas prices continue. In contrast to this, we have been told by one Big 6 energy supplier in the UK this week, that they will soon be looking to pass on the costs that they have inherited from Ofgem (for the UK energy companies that failed last year) to some of their customer base. We will share more news regarding this once we have it.
  • Gazprom’s entity in the UK, which is now under control of the German state government, have told us today that they will soon be shedding the Gazprom name. The company will be known as SEFE Energy UK Ltd. SEFE stands for Securing Energy For Europe and was formerly known as Gazprom Gemania GmbH, but dropping the unpopular Gazprom name will no doubt help with the company image in the UK.
  • The Celtic Sea, which includes a large stretch of water between the Cornish coast and the Scilly Isles, has been identified as a potential major new development area for a huge floating offshore wind farm project. The area is owned by The Crown Estate, and they are looking at leasing five ‘areas of search’ which if successful, will lead to enough energy being generated to power 9 million homes, turning the area into a ‘great renewable energy basin’. The plan is to use new floating technology for the project and if agreed, the new technology will help the UK to ‘unlock the full potential of our coastline’.  

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