lpm - Utilities Market Knowhow!
As of 8th January 2016 there were further substantial falls on December’s report for both the Year Ahead Wholesale Gas and Electricity contracts.
The news that OPEC will not be looking to reduce Oil output and that Iran are likely to start exports in January 2016, has meant that Oil prices hit 12 year lows in January. The move by OPEC is largely to retain their market share and increase financial pressure on US producers who are adding more debt to their operations, but are proving resilient.
Saudi Arabia are looking at ways to adapt to the lower revenue by cutting their budgets and by potentially selling a proportion of their state owned, Aramco. Its complete sale would make this the world’s largest company. These measures would suggest they are not likely to cut output in the short term.
What does this mean to me...
World events and a healthy domestic position mean prices have continued to fall far beyond expectations and so offer extremely good value to customers looking for contracts starting 2016 / 2017.
lpm recommend that customers at least look at contracting now, as these low prices are thought to be nearing the bottom end of what the industry can tolerate without further generation or production going offline, due to the economics of supply.
lpm, together with utilities broker Indigo Swan, would be happy to research development communal supply options for 12, 24 and 36 month contracts, to determine the potential benefits these current low prices might mean for you.
To find out more about how these current low energy prices can benefit you, please contact your lpm Estates Manager now.
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