Logic says that the UK will try and negotiate an agreement which still gives them access to freedom of movement of goods and capital but not people. That will require the UK to keep a huge range of EU policies and it is likely that the EU ETS would be one of them, however, you could see a world where it pulls out of the EU ETS and just keep the carbon tax and argue it's an equivalent measure. Really, all we have now is uncertainty.

Trevor Sikorski

Categorized in : Energy

With the UK likely to have a 1.20-1.75 bcm shortfall of gas in storage compared to last year's use (potentially an average supply shortfall of 11 mcm/day), the UK gas balance will likely have to replace that volume from other sources.

Trevor Sikorski

It is expected that four wells (of 24 operated typically) will be opened to allow withdrawal from November. Working gas at Rough for the winter will now not exceed 1.3 bcm ...this is 1.2 bcm less than last winter's withdrawal.

Trevor Sikorski

Any increase in free allocation would result in a reduction in auction volumes - so the impact would be less industrial buying and potentially more (industrial) selling but that would be offset with the reduction in (auctioning) volumes.

Trevor Sikorski

Ukraine wants to have 19 bcm in storage by the end of the summer but it doesn't have the money to buy that gas. The probable outcome is it will have around 14 bcm. They could probably get through most winters with that amount but if it is cold they will struggle and look for gas from western Europe, we forecast the seasonal ramp in prices could go as high as 53 pence/therm (peak winter weather prices).

Trevor Sikorski

It underlines there's not a lot of hope for additional gas to come out of the Netherlands this year, or probably ever.

Trevor Sikorski