On the oil market, it is mainly Iran and the peace negotiations with Russia that are in the spotlight. Oil has become more expensive, but the price continues to fluctuate at a relatively low level. Gas prices have been rising for a number of weeks now. There is news on the electricity market: the introduction of quarter-hourly instead of hourly prices for electricity on the day-ahead market is being postponed from 11 June to 30 September.
Gas prices have increased in the past week. Compared to last Thursday (15 May), an increase can also be seen on the TTF futures exchange. On Wednesday 21 May, gas costs €37,375 per MWh, which is 6,6% more than last Wednesday. Compared to 29 April, gas is almost 17% more expensive.
The European Commission’s goal of total independence from Russian energy plays a role in the recent increase. There is also maintenance and outage at gas facilities in Norway, a major gas supplier. The price increase was curbed by negotiations to end the war in Ukraine.
The filling level of European gas reserves is now almost 45% (was just over 43% last week) according to data from GIE AGSI. In the Netherlands it is around 32%.
Oil
At the time of writing (Wednesday afternoon, May 21), oil is priced at $66,22 per barrel. Oil has risen in price after CNN reported that according to US intelligence services, Israel is preparing to attack Iranian nuclear facilities. This while the US is negotiating a nuclear deal with Iran. An attack on Iran would further increase tensions in the Middle East and possibly hit oil exports.
Although oil is up 2,6% from a week ago ($64,53 per barrel on Thursday, May 15), oil remains at a relatively low level. After April 2, the day Trump declared “Liberation Day” and on which he imposed high import tariffs on the world – most of which have been temporarily reversed – oil has slid along a steep path downward. On April 2, oil was trading at $74,95 per barrel. The oil price has remained below levels last seen in August 4 since April 2021, with recent highs and lows of $67,96 per barrel on April 17 and $60,23 per barrel on May 5.
From the two largest oil consuming countries, China and the US, comes this not so encouraging economic news. Credit rating agency Moody's lowered the creditworthiness of the United States on Friday from the top rating triple-A to Aa1. S&P and Fitch did this earlier. The reason is the increasing budget deficit. In China, despite the measures that are supposed to stimulate consumption, the growth of retail sales slowed down in April, according to figures published on Monday by the Chinese Bureau of Statistics. The fact that the US import tariffs for most Chinese goods have been temporarily adjusted from 145% to 30% is encouraging, but there is great uncertainty about what will happen after ninety days.
What is supporting the oil price are the nuclear talks between the US and Iran and those on ending the war in Ukraine. Both Russia and Iran are under sanctions on oil exports. If they are lifted, more oil will probably come onto the market. A positive outcome of both negotiations is far from certain, however.
New day-ahead pricing postponed
From 11 June, electricity prices would also fluctuate per quarter on the day-ahead market, but the system was not yet fully in order. The new date is 30 September. Industry organisation Energie-Nederland finds it understandable that certainty is preferred over speed. "If the newly introduced system does not work properly or has to be reversed, that will cause major problems."
According to Energie-Nederland, the switch is 'an important step towards a more efficient electricity market'. "This new pricing structure is better suited to the increasingly flexible power consumption and the variable energy yield of solar and wind." The industry organization states in a statement that it is important that the introduction is not postponed again. "If the introduction is postponed again and again, there will be permanent uncertainty for market parties and that is detrimental to confidence in the system."
For consumers with a dynamic energy contract, the current hourly rates are important. For them, nothing will change after the introduction of quarterly rates, according to a survey by RTL Z. The large energy suppliers intend to continue charging the consumer with hourly rates for the time being.
The graph shows daily averages, but the price can vary considerably per hour, and soon per quarter. A large supply of renewable energy regularly results in hours with negative electricity prices. The weather forecasts show less sun but more wind in the coming days.