Innovative Energy Consultancy Ltd
Innovative Energy Consultancy Ltd

October Markets Update


  • Despite gas storage reaching average levels last month, gas market prices continued to skyrocket throughout September, causing various energy providers to go bust and triggering a range of supply chain issues across the country.
  • The same issues that have plagued the country throughout the year continue to pressurise the gas supply, including low storage capacity after an unusually cool spring, rearranged and additional maintenance after last year’s covid issues, poor supply into Europe from both Norway and Russia, and significant LNG imports being redirected to Asia due to their premium prices.
  • Extreme weather conditions such as fires in Malaysia’s LNG complex and the recent hurricanes across the US have also worked to disrupt global supply chains, driving prices up by delaying replenishment of LNG storage levels.
  • Although in recent months the supply has been sufficient to meet the summer demand, the concerns lie in uncertainty of whether winter demand can be fulfilled. Ultimately, this has been the main driver behind market increases over recent months.



  • Electricity markets have continued to follow gas trends, as both are intrinsically linked.
  • A summer of low wind across Western Europe has also significantly reduced the amount of renewable power available, increasing the demand for gas to power generation, dragging the price higher. Though there is hope that as we move into the winter months, wind strength will increase and this may help ease volatility.
  • The UK’s main subsea interconnector which links our electricity network to France caught fire in early September. This has meant imports have been further reduced, exacerbating concerns that prices will continue to rise further. Unfortunately, the outbreak of the IFA1 interconnector will limit electricity supplies until next March, further impacting both gas and power markets.
  • UK carbon price has soared by over 30% since the start of the month, reaching a new record high of £75/tonne by 30th September. This has also helped support both electricity and gas markets.



  • Brent and crude oil both followed the energy markets price rise, hitting record highs at $80 a barrel and $80.22 a barrel respectively.
  • The three-year high for oil prices came as Opec forecast that global demand for crude would exceed 2019 levels in 2023 and continue to rise until 2035 before plateauing.
  • There have even been reports of oil to power generation being actioned in parts of Asia, which hasn’t been seen for decades.



  • Extreme gas and electric price rises have made coal to power generation economically feasible again, despite plans to reduce coal power significantly over the next few years.
  • This increase in demand has also enabled the coal price to rise, as the UK scrambles to get control of its energy markets.
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