The Bord Gáis Energy Index (BGEI), an Irish-specific index designed to measure prices in the wholesale energy market, increased by 1 percent in June. The Energy Index now stands at 111 even. Energy Trading Analyst, Micheal Kelleher stated that: “the Index now appears to be consolidating at current levels after a relatively steady rise from the recession-driven lows of March 2009”.
The Index is designed to track movement in the wholesale energy market and comprises the four key energy commodities of oil, gas, coal and electricity. The Index tracks the monthly global price movements of these commodities, factoring in any currency shifts, and producing an overview and insight into the global energy sector. Launched last month, the new Energy Index is the first initiative of its kind in the Irish market.
The rise in the energy index was partly due to the weakening of the Euro against the US Dollar and Sterling. The continued weakness of the Euro is being driven by worries surrounding the sovereign debts of some European countries undermining the stability of the single currency. Sterling also received a positive response from the British Government’s stern budget.
Its key findings were that the price of oil rose marginally by 1 percent in June, from €60.66 to €61.29 per barrel.
The price of natural gas rose by 11 percent in Euro terms due to a broad range of issues including erratic flows from the Norwegian Langeled pipeline, infrastructural maintenance affecting Qatari LNG (liquefied natural gas) and higher than expected exports to the continent.
The 6 percent rise in the price of coal in June continued a trend seen since mid-March where prices have been driven up by increased demand from UK utilities after a period of destocking as well as the impact of a number of coal mine closures in Germany.
Electricity prices, meanwhile, remained at a similar level to May with the average price €54/MWh. Demand is lower this time of year compared to winter months and therefore lessens the need to bring on line a more extensive plant. However, wind output was on average approximately 20MW lower in June than in May.