A Balancing Act Between Supply, Demand, and Geopolitical Uncertainties

Despite the UK and the European continent boasting record high gas storage levels for this period, along with a substantial supply courtesy of both domestic and international imports, the price index has seemingly defied logic.

The domestic demand curve has softened due to less influence from the weather, along with a decrease in the need for gas powered electricity generation as renewable energy sources progressively shoulder the load.

Yet, the price tags on natural gas remain stubbornly high, sitting way above resistance levels.

What is behind the surge of UK gas pricing?

The market, it appears, is currently overly sensitive and reactive to any negative news, amplifying fears of a potential supply crunch.

The roots of this anxiety can be traced back to the inconsistent supply of Russian piped gas into the European grid.

LNG cargoes are lucrative targets for Asia and Europe, igniting a “price war” that typically intensifies during the winter months.

The Israeli/Hamas conflict is also creating volatility in energy commodity markets globally.

These undercurrents of geopolitical uncertainties are creating a narrative of apprehension that overrides the otherwise reassuring statistics of supply and demand.

The combined impact?

We will continue to see these factors dictating the market and driving up pricing for the foreseeable future.

At NGP, our expertise and market intelligence achieve long-term stability for your energy costs, helping to secure the future for your business. We have helped thousands of businesses navigate the energy crisis, giving budget certainty and a plan to move forward.

We understand that the energy market is notoriously sensitive to supply shocks and is influenced by global events. Our team of experts keeps a close eye on these factors, providing businesses with the market intelligence and real-time data they need to make informed purchasing decisions.

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