With the current glorious weather, you might not be thinking to much about your energy usage. However, as you can see from the below graphs, we are still in an exceptional place in the market despite the more recent market increases over the past few weeks.
The market is near the levels seen at the start of 2021 before the energy crisis so has little room to come down further, pairing this with the cumulative 20%+ inflation since then in the UK there is little more movement if any. In short, the market is in a great position, we recommend securing now longer term to ensure great budget certainty as a 12-month contract poses greater risk and leaves you exposed to outside Geopolitical factors.
Further to this a longer-term contract allows you to selectively choose when to next procure, if the market is lower next summer then we can capitalise on that and forward procure for another 12 months, and if the market is higher, signing until 2026 gives us another 12 months to monitor the market and identify an entry point to procure beyond.
The main causes for concern are:
Increased Military action against both the Russian and Ukrainian energy infrastructure.
Heightened tensions in the middle east, with markets watching intently any developments to recent events within Israel and Iran
Awaiting the outcomes of unplanned outages at 2 of Norway’s gas processing plants (Norway is the EU’s largest gas provider), with flows remaining strong, but reduced enough to raise alert levels when combined with the above.
Looking at the bigger picture with regards to wholesale pricing, current contracts (although higher than their lowest points in mid-late February), still represent good value when compared against the 24 months of pricing throughout 2022 and 2023.
To find out if Your Time have reduce your energy payments email dean@yourtimebusinesssolutions.co.uk
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