Introduction: Energy price cap expected to rise by 1% in January
good morning. Welcome to our regular coverage of business, financial markets and the global economy.
Analysts predict that energy bills for households across the UK will rise early next year, further putting pressure on household budgets.
Officially, price caps from January to March 2025 will be set by regulators on Friday morning off gemthere are restrictions on what energy providers can charge you in England, Scotland and Wales.
However, the analyst cornwall insight They have crunched the numbers and predict the cap for a typical dual-fuel household will rise to £1,736 a year in January, up from the current level of £1,717 a year set in October.
This is a 1% increase from the current price cap and a blow to hopes that the note could drop in early 2025.
Importantly, however, this cap limits how much consumers can charge per unit of energy, not a cap on their potential bill, as households typically spend more on heating in the winter. , which means your bill will be higher.
cornwall insightThe calculation is based on wholesale prices of energy and says:
This ceiling level reflects a relatively volatile wholesale market, influenced by supply concerns related to geopolitical tensions, maintaining Norway's gas infrastructure, weather disruptions and other minor factors.
Despite price stability compared to the past two years, the market remains highly sensitive to global events. Because of this, prices are significantly above historical averages.
At the end of September, Cornwall expected the price cap to fall in January.but wholesale energy prices are higher than expected.
Last Friday, last month's UK gas price rose to a one-year high of almost 120p per therm.
Gasoline prices rose last week under the influence of the Austrian group OMV It warned that supplies from Russia could be disrupted. Saturday, Gazprom actually stopped supplying to Austria. OMV Obtained a €230 million arbitration award against Russia's state-run natural gas company.
Looking further ahead, Cornwall currently expects the cap to be lowered slightly in April 2025 and again in October 2025.
agenda
-
8:00 a.m. GMT: Joachim Nagel, President of the Bundesbank, speaks.
-
10am (GMT): Eurozone trade balance for September
-
3pm GMT: US Nahb Housing Market Index
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Brent crude, the international benchmark, is up 0.3% at $71.26 per barrel, having hit its lowest level since the start of October on Friday.
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The rise follows the fierce missile and drone attack launched by Russia last weekend at Ukraine’s energy grid, which killed seven people and forced nationwide electricity rationing to be introduced today.
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Ukrenergo, Ukraine’s principal energy supplier, said blackouts and consumption restrictions would be introduced “in all regions” as engineers tried to repair as much of the damage to power facilities as possible.
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Russia has also accused Joe Biden’s administration of “trying to escalate the situation to the maximum”, after the White House lifted the ban on Ukraine using long-range missiles to fire into Russian territory yesterday.
“,”elementId”:”b305feb4-7803-4c99-ac58-239b77bd715d”},{“_type”:”model.dotcomrendering.pageElements.RichLinkBlockElement”,”prefix”:”Related: “,”text”:”Biden lifts ban on Ukraine using US weapons to strike deeper into Russia”,”elementId”:”b5490620-b2ed-40ae-a2d4-5ae042851989″,”role”:”thumbnail”,”url”:”https://www.theguardian.com/world/2024/nov/17/biden-has-lifted-ban-on-ukraine-using-us-weapons-to-strike-deeper-into-russia-reports”}],”attributes”:{“pinned”:false,”keyEvent”:true,”summary”:false},”blockCreatedOn”:1731914233000,”blockCreatedOnDisplay”:”02.17 EST”,”blockLastUpdated”:1731914627000,”blockLastUpdatedDisplay”: “02.23 EST”,”blockFirstPublished”:1731914627000,”blockFirstPublishedDisplay”:”02.23 EST”,”blockFirstPublishedDisplayNoTimezone”:”02.23″,”title”:”Oil rises as Russia-Ukraine tensions rise”,”contributors”:[],”primaryDateLine”:”Monday 18 November 2024 02.23 EST”,”SecondaryDateLine”:”First published Monday 18 November 2024 01.58 EST”},{“id”:”673ae0a08f087357b482afad”,”elements”:[{“_type”:”model.dotcomrendering.pageElements.TextBlockElement”,”html”:”
This morning’s prediction of a small rise in energy bills in January will be “disappointing”, says Dr Craig Lowrey, Principal Consultant at Cornwall Insight, especially as the weather gets chillier.
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“Our final price cap forecast for January indicates, as expected, bills will remain largely unchanged from October. Supply concerns have kept the market as volatile as earlier in the year, and additional charges have remained relatively stable, so prices have stayed flat. While we may have seen this coming, the news that prices will not drop from the rises in the Autumn will still be disappointing to many as we move into the colder months.
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“Fuel poverty has occupied political agendas for years, with little long-term progress. This winter, millions of households say they will not heat their homes to recommended temperatures, risking serious health consequences. With it being widely accepted that high prices are here to stay, we need to see action. Options like social tariffs, adjustments to price caps, benefit restructuring, or other targeted support for vulnerable households must be seriously considered.
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“Long-term, our transition away from the volatile global wholesale market toward sustainable, home-produced renewables can help to secure our energy future. Although the transition does require upfront investment, it promises lower bills down the line. The government needs to keep momentum on the transition while acknowledging that immediate support is essential for those struggling now. Inaction is a choice to leave people in the cold.”
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Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
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Household energy bills across Great Britain are set to rise at the start of next year, analysts predict, putting more pressure on household finances.
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Officially, the price cap for January-March 2025 will be set on Friday morning by regulator Ofgem, limiting what energy providers can charge in England, Scotland and Wales.
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But analysts at Cornwall Insight have crunched the numbers, and predict that the cap for a typical dual fuel household will rise to £1,736 per annum in January, up from the current level of £1,717 per year set in October.
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This is a rise of 1% from the current price cap – a blow to hopes that bills might drop at the start of 2025.
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Importantly, though, the cap limits the amount that a consumer can be charged for each unit of energy – not a ceiling on potential bills, which are usually higher in the winter as households spend more to keep warm.
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Cornwall Insight, whose calculations are based on the wholesale price of energy, say:
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The cap level is a reflection of a relatively volatile wholesale market, influenced by supply concerns tied to geopolitical tensions, maintenance on Norwegian gas infrastructure, weather disruptions, amongst other smaller factors.
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Despite prices stabilising in comparison to the past two years, the market remains very sensitive to global events. This is leaving prices substantially above historic averages.
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At the end of September, Cornwall had expected the price cap would dip in January, but wholesale energy prices have been higher than hoped.
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Last Friday, the month-ahead price of UK gas rose to a one-year high of almost 120p per therm.
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Gas prices rose last week, after Austrian group OMV warned of a potential disruption to supplies from Russia. On Saturday, Gazprom did indeed stop supplies to Austria, after OMV won a €230m arbitration award against Russia’s state-owned natural gas company.
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Looking further ahead, Cornwall currently forecast the cap will drop slightly in April 2025 and again in October 2025.
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The agenda
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8am GMT: Bundesbank President Joachim Nagel gives speech
- \n
10am GMT: Eurozone trade balance for September
- \n
3pm GMT: US Nahb Housing Market Index
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main events
Oil prices rise as tensions between Russia and Ukraine intensify
Oil prices are rising this morning as the conflict between Russia and Ukraine escalated over the weekend.
Brent crude, the international benchmark, rose 0.3% to $71.26 a barrel, hitting its lowest since early October on Friday.
The rise comes after heavy missile and drone attacks launched by Russia on Ukraine's energy grid over the weekend, killing seven people and forcing the introduction of nationwide power rationing today. It is what I received.
ukulenergoUkraine's main energy supplier, said power outages and consumption restrictions would be introduced “in all regions” as engineers try to repair as much damage to power equipment as possible.
After the White House yesterday banned Ukraine from launching long-range missiles into Russian territory, Russia also accused President Joe Biden's administration of trying to “maximize the escalation of the situation.”
Details of Cornwall Insight's forecast of UK energy price caps from January are below.
Cornwall: 'disappointing' that prices won't fall in January
This morning's prediction that utility bills will rise slightly in January is “disappointing”. Dr. Craig LauriePrincipal Consultant cornwall insightespecially as the weather gets colder.
“Our final price cap forecast for January shows that, as expected, billings will remain broadly unchanged from October. Supply concerns continue to leave the market as volatile as earlier this year. Surcharges have remained relatively stable, so prices have remained flat. We may have seen this coming, but the news that prices won't come down from the fall increases is a sign of the colder months. Even now, it will disappoint many people.
“Fuel poverty has been on the political agenda for years, but little long-term progress has been made. This winter, millions of households say they will not heat their homes to recommended temperatures, leading to serious health risks. It is widely accepted that high prices will continue, and we need to take action by adjusting social charges, price caps, or restructuring benefits for vulnerable households. Options such as targeted support for people should be seriously considered.
“In the long term, the transition from volatile global wholesale markets to sustainable, home-produced renewable energy will help secure our energy future. The transition will require upfront investment, but Governments need to maintain the momentum of the transition, recognizing that immediate support for those currently struggling is essential. So it's a choice that treats people poorly.”
Introduction: Energy price cap expected to rise by 1% in January
good morning. Welcome to our regular coverage of business, financial markets and the global economy.
Analysts predict that energy bills for households across the UK will rise early next year, further putting pressure on household budgets.
Officially, price caps from January to March 2025 will be set by regulators on Friday morning off gemthere are restrictions on what energy providers can charge you in England, Scotland and Wales.
However, the analyst cornwall insight They have crunched the numbers and predict the cap for a typical dual-fuel household will rise to £1,736 a year in January, up from the current level of £1,717 a year set in October.
This is a 1% increase from the current price cap and a blow to hopes that the note could drop in early 2025.
Importantly, however, this cap limits the amount consumers can charge per unit of energy, not a cap on their potential bill. Bills are typically higher in the winter as households spend more to heat their homes.
cornwall insightThe calculation is based on wholesale prices of energy and says:
This ceiling level reflects a relatively volatile wholesale market, influenced by supply concerns related to geopolitical tensions, maintaining Norway's gas infrastructure, weather disruptions and other minor factors.
Despite price stability compared to the past two years, the market remains highly sensitive to global events. Because of this, prices are significantly above historical averages.
At the end of September, Cornwall expected the price cap to fall in January.but wholesale energy prices are higher than expected.
Last Friday, last month's UK gas price rose to a one-year high of almost 120p per therm.
Gasoline prices rose last week under the influence of the Austrian group OMV It warned that supplies from Russia could be disrupted. Saturday, Gazprom actually stopped supplying to Austria. OMV Obtained a €230 million arbitration award against Russia's state-run natural gas company.
Looking further ahead, Cornwall currently expects the cap to be lowered slightly in April 2025 and again in October 2025.
agenda
-
8:00 a.m. GMT: Joachim Nagel, President of the Bundesbank, speaks.
-
10am (GMT): Eurozone trade balance for September
-
3pm GMT: US Nahb Housing Market Index
