Indigo Swan Energy Report August 22
✓ Very high Gas and Electricity Wholesale costs.
✓ Potential for further disruption to Gas imports from Russia.
✓ EU Gas Storage levels are an improved 70% full, compared to 57% last year.
As of the 2nd of August, Gas and Electricity Year Ahead Wholesale costs were higher, when compared to last month’s report. The Oil price remains at $101 per barrel, although it did peak at $110 over the last month.
Prices continue to increase as Russia takes measures to reduce Gas supplies into Europe, creating concern and instability. The assumption is that this is in response to sanctions and the assistance being provided to Ukraine.
The Nord Stream 1 Gas pipeline is operating at just 20% of capacity due to maintenance, which is widely thought to not be required. A growing number of countries have had Gas supplies cut off as they refuse to pay in roubles, the latest being Latvia. EU member states are very aware that Russia could potentially stop flows of Gas coming into
Europe at any time and so have introduced a voluntary requirement to reduce Gas consumption by 15% up until March 2023. This will become mandatory should the situation deteriorate, which may bring in the enforced rationing for industries, to preserve supplies for the likes of domestic heating and hospitals. EU Gas Storage levels are currently
70% full, with a target of 80% by November.
The Met Office forecast suggests we will see above seasonal norm temperatures at times in August, with little
mention of strong winds, which would mean the continued high use of Gas for Electricity generation.