Wholesale gas prices down 41pc - but will you see the difference in your bill?
Published 29/03/2016 | 02:30
Irish wholesale gas prices are 41pc lower on average so far in March compared with the same month last year and are down 38pc year-on-year for the first quarter.
While prices are unchanged compared with February, they remain at lows not seen since April 2010, according to the latest energy market report from Vayu Energy.
The average day-ahead price for gas - the contract for gas delivery for tomorrow - is 1.31 c/kWh (cents per kilowatt hour) so far in March. This compares with an average price of 2.23 c/kWh in March 2015. Irish wholesale gas prices have now over halved in euro terms compared with the average monthly price recorded for March over the previous three years.
Joanne Daly, energy analysts at Vayu, said the gas market remains oversupplied this month, with strong supplies of LNG (liquefied natural gas) from the Middle East expected to continue as we approach the summer months.
"An oversupply of gas and weak demand mean Europe's inventory levels are significantly above normal for this time of year. This, combined with an 8pc strengthening in the value of the euro against sterling over the last 12 months, has resulted in a dramatic collapse in wholesale prices," says Ms Daly.
"New volumes of LNG this year from the US and Australia and seasonal falls in demand are likely to result in further downward pressure on prices.
"There's therefore limited risk of significant price increases in the near term, barring any unplanned outages."
The average wholesale price of electricity in the Irish market so far during March is 3.71 c/kWh - a decrease of 31pc compared with March 2015 and unchanged compared with last month.
In January average wholesale prices were 40pc lower than in the same period last year. However, only a small portion of the benefit was passed onto consumers by providers.
Household bills experienced falls of between 2pc and 2.5pc with energy firms arguing it takes time for the change in prices to filter down to customers.