Oil prices rally as OPEC production levels decline

Oil prices rally as OPEC production levels decline

Oil prices have driven UK and European energy markets on an upward trend over the last month, as Brent Crude reached 4 year highs and breaching the $80/bbl mark. Geopolitical tension this year has saturated all commodity markets. The US and North Korea headlining, following by issues with the US-China trade deal. Meanwhile, OPEC members are producing low levels of oil, and have essentially re-balanced the market, causing a complete shift from an over-supplied market to once where supply is a concern.

Strong renewable power generation leads to zero coal fired power for 55 hours

Strong renewable power generation leads to zero coal fired power for 55 hours

The UK went 55 hours without coal fired power last week, as a result of strong renewable generation, mainly in the forms of solar and wind. Additionally, the UK experienced low demand for both gas and power while the ‘mini-heat wave’ saw temperatures increase to almost 28 degrees. There has been a huge shift over towards renewable generation, and a sharp drop in coal fired power being generated in the UK.

Eggborough power station to close in September after missing out on capacity market contract

Eggborough power station to close in September after missing out on capacity market contract

Eggborough, one of the UK’s largest coal power stations, is set to close before the end of the year as it’s become less and less economical to generate power. The power station is capable of generating power from biomass as well as coal, however after failing to obtain a Capacity Market contract in the last round of auctions. Many of the UK’s gas and coal fired power plants rely heavily on winning Capacity Market contracts in order to remain profitable, however Eggborough have missed out this time round, causing its imminent closure.

Gas from Norwegian Troll field helps UK meet gas demand

Gas from Norwegian Troll field helps UK meet gas demand

Norway’s largest gas field lies on the Norwegian Continental Shelf in the North Sea. The Troll gas field has the ability to produce enough gas to supply almost 40% of the UK’s annual gas demand. The UK is the largest importer of Norwegian gas, closely followed by Germany and France. While the UK gas market is adapting to the loss of Rough – the UK largest offshore gas storage facility – the Troll gas field is anticipated to make up for some of that loss.

The first year of capacity market has started. What does this mean for UK power supply?

The first year of capacity market has started. What does this mean for UK power supply?

This winter will be the first winter that promises the delivery of power through the Capacity Market (CM) scheme. The scheme which currently sits under the Electricity Market Reform (EMR) aims to increase UK power generation and capacity during peak hours and periods of system stress. Initially the CM scheme was to be introduced in October 2018, however due to tight supply over last winter (winter 16/17), the Government brought the delivery date forward by 1 year.

Production begins at two new gas fields off the coast of the Shetland Islands

Production begins at two new gas fields off the coast of the Shetland Islands

The first gas has been extracted from new gas fields, located just off the coast of the Shetland Islands. The two fields, named Edradour and Glenlivet are estimated to provide around 1.9 million barrels of oil and gas equivalent in 2018. This comes at a time when gas supply in the UK is below normal as the largest offshore storage site Rough is closed, leaving only cushion gas to be withdrawn over the next few years.