A choppy week ended firmer, and the winter picture is still tight.
Summary:
Gas and power fell sharply on Tuesday, then recovered by Friday as the market’s focus moved back to winter risk. European storage ended September well below its normal level, so the underlying pressure has not gone away. If you renew this winter, that matters more than any single week’s move.
What happened
A choppy week that ended firmer. A sharp fall on Tuesday was more than recovered by Friday, as the market’s focus swung from supply relief back to the risks building into winter. Monday edged higher, with traffic through the Strait of Hormuz reportedly still a fraction of normal after Washington rejected Iran’s reopening proposal, and Qatar reportedly extending its LNG force majeure into December. Tuesday brought broad relief as Saudi Arabia resumed tanker loadings at Yanbu after restarting the East West pipeline, the compressor outage at Norway’s Troll field ended, and warm, windy weather pulled prices lower across Britain and the Continent. It did not last. Fresh unplanned outages at the Njord and Troll fields lifted gas on Wednesday, and reports suggest a string of tanker strikes around the strait, including two off Oman late in the week, pushed the curve higher into Friday, with Iran reportedly warning that ships transiting without its permission would be targeted. Underneath, the winter picture remains tight. European storage ended September at around 71% full against a five year norm of about 87%, and the final stage of the EU ban on Russian LNG takes effect in January. In power, patchy wind and a nuclear fleet running well below capacity, with three EDF reactors offline, left the system leaning on gas plant. With Washington reportedly signalling that military action could resume after the US midterms in November, the market looks set to stay driven by headlines.
What this means for your business
If you’re on a fixed contract
- Your current rate is protected, and this week’s swings do not change that.
- If your renewal falls this winter, you will be quoted into a market that moves sharply on headlines and still has thin storage behind it.
- Starting your renewal early gives you time to compare options calmly, rather than renewing on a bad day.
If you’re on a flexible or variable contract
- You feel these swings directly. Tuesday’s fall and Friday’s recovery show how quickly the market can turn.
- Storage sitting well below the five year norm leaves little room for a cold spell or another supply outage.
- Know your budget position now, and decide in advance what price movement would trigger a conversation about fixing.
Get the full UK Energy Market Update
Download the full wholesale market update as a PDF for your records Rybeda 6th October Weekly Energy Market Update or to share with your operations & finance team.
Not sure what any of this means for your contract?
Our energy health check takes a few minutes and gives you a clear picture of where you stand, what type of contract you are on, and whether now is the right time to act.
Start your free energy health check.
Check out our recent Client Case Studies to see how we have helped with their business energy and learn more about what we stand for and against.
Want to talk it through?
If you would rather speak to someone directly, we are happy to give you a straight answer with no obligation. No sales pitch, just honest advice.
Talk to an energy specialist now, call 0203 534 465.