UK gas prices set to fall?

scorza · 5 Dec 2011 at 09:41

Apologies for yet another dull topic, but I'm sure some guy on The Politics Show yesterday said that a decision had been made in the USA to export more natural gas which would have a significant impact on the UK market but didn't expand on this any more. Anyone know anything about this? Haven't been able to find anything that backs this up on Google (mainly because silly Americans call petrol gas).

Efour · 5 Dec 2011 at 09:45

http://news.nationalgeographic.com/news/energy/2011/11/111117-us-natural-gas-export/

V4NT0M · 5 Dec 2011 at 09:53

More likely they will go up.

GAC · 5 Dec 2011 at 09:54

and you really think the gas suppliers will drop there prices, you know theres laaaaaaaaaaag as they call it. so it wont go down till we have been fleeced for a good 18 months more i bet.

Edrof · 5 Dec 2011 at 10:01

And by then people will have forgotten about the 'promised' lowering of prices.

scorza · 5 Dec 2011 at 10:16

GAC said:
and you really think the gas suppliers will drop there prices, you know theres laaaaaaaaaaag as they call it. so it wont go down till we have been fleeced for a good 18 months more i bet.

No

I fully expect that after years of being told that our gas prices are going up because of the increased price on the wholesale market, when the price on the wholesale market goes down our gas suppliers will tell us that they bought a long forward contract at the high price.

platypus · 5 Dec 2011 at 10:41

We will be told the same nonsense about their prices being higher prices for long term, and dangle a carrot of potential price drops a few years in the future.

antijoke · 5 Dec 2011 at 10:44

Wont happen, just like petrol prices they will continue to go up and up.

Cosimo · 5 Dec 2011 at 10:47

anticonscience said:
Wont happen, just like petrol prices they will continue to go up and up.

In a never ending spiral until we are all in fuel poverty.

Zenduri · 5 Dec 2011 at 12:50

Europe's (Uk inc) gas comes mainly from Russia... America has very little effect on Uk gas prices... the Russians control prices around here.

Fact im afraid

Source: Work for 1 fo the "big 6" UK energy suppliers

platypus · 5 Dec 2011 at 13:25

America has very little effect on UK prices because they haven't really exported much of it. However, with a surplus now brought about by the shale extraction they might well start to do so.

scorza · 5 Dec 2011 at 13:30

platypus said:
America has very little effect on UK prices because they haven't really exported much of it. However, with a surplus now brought about by the shale extraction they might well start to do so.

Yup, natural gas is the USA is apparently five times cheaper than it is here. This makes us an attractive market for the US gas companies, however how soon will they be able to start exporting it? Do LNG capabilities need to be constructed in the UK, Europe or the USA before this is possible?

StonedPenguin · 5 Dec 2011 at 13:32

They want to fall! My Gas bill is horrendous

platypus · 5 Dec 2011 at 13:39

Well, they can ship it over here scorza and I would presume we have facilities to take it off ships, as we do it currently, no?

Amp34 · 5 Dec 2011 at 13:44

HybridX said:
Europe's (Uk inc) gas comes mainly from Russia... America has very little effect on Uk gas prices... the Russians control prices around here.

Fact im afraid

Source: Work for 1 fo the "big 6" UK energy suppliers

Not much UK gas is from Russia AFAIK, most is either from the North Sea or soon to be imported from the middle east. A huge proportion of some european nations gas is however (excluding places like Holland, Norway and maybe Denmark).

scorza said:
Yup, natural gas is the USA is apparently five times cheaper than it is here. This makes us an attractive market for the US gas companies, however how soon will they be able to start exporting it? Do LNG capabilities need to be constructed in the UK, Europe or the USA before this is possible?

Yes the would need to be, however there are already projects under way in Wales for this, with tankers from the Middle east.

platypus · 12 Jan 2012 at 12:36

British Gas said the average annual domestic bill would fall by £24.

How generous our utility bringing overlords are.

Freakbro · 12 Jan 2012 at 12:42

scorza said:
No I fully expect that after years of being told that our gas prices are going up because of the increased price on the wholesale market, when the price on the wholesale market goes down our gas suppliers will tell us that they bought a long forward contract at the high price.

From what they said on the news yesterday, the wholesale gas price has been dropping for a year now!

EDF raised their prices 15% in Nov....and have now dropped them 5%.

Of course, now they say the raised prices were not due to the wholesale gas price, but costs in transportation, admin etc etc, when I'm sure at the time they said it was due to the wholesale price.

Cosimo · 12 Jan 2012 at 12:44

platypus said:
How generous our utility bringing overlords are.

The fall will last for a month or two in the summer and then rise by £50.

platypus · 12 Jan 2012 at 12:45

As predicted..

British Gas said that it was not changing its gas charges because, although there had been some short-term falls in the cost of gas, the longer term trend in wholesale prices was upward. It said it bought its energy in advance.

Freakbro · 12 Jan 2012 at 12:48

Heh, look at this graph of wholesale prices over the last 2 years...

http://www.catalyst-commercial.co.uk/energy_market_intelligence/uk_gas_prices/

Huge drop in wholesale price since Apr 11....