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Coronavirus hits energy prices

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Coronavirus has hit oil demand

Coronavirus has hit oil demand

REUTERS

Coronavirus has hit oil demand

THE coronavirus crisis has disrupted Chinese demand for oil and is driving down wholesale energy prices here.

Naturgy and Bord Gáis Energy said the wholesale price of oil fell 15pc last month; wholesale electricity by 7pc.

The two differed on the monthly decline in natural gas prices; Naturgy put it at 13pc, Bord Gáis at 11pc.

Both attributed the slump in prices to China's battle to contain the spread of coronavirus.

"The outbreak of the coronavirus has taken its toll on global energy markets," said Bord Gáis energy trader David Grainger.

"With China being the largest oil importer in the world, decreased demand could see prices track downwards as a result of economic slowdown and limited demand for oil," Naturgy energy analyst Lauren Stewart said.

While oil in January remained 6pc more expensive than 12 months ago, average wholesale prices for electricity and natural gas dropped by 47pc and 52pc respectively over the year.

"There is great value currently in the energy market," said Ms Stewart, who added: "This stands to benefit businesses in the short term."

Electricity demand last month increased by 2.6pc nationwide. But this was offset by a 5pc increase in output from wind farms, which contributed 42pc to Ireland's grid network, slightly higher than in December.

Irish Independent