In recent months, spot prices of UK gas have soared, from ca.30p per therm during the summer to well over £2 per therm by October; they have, though, fallen back from their peak over the last few days. As the soaring prices imply, availability of gas during the coming winter is also a major issue, especially if prolonged periods of cold weather arise.
In fact, gas supply across the globe is a real issue, with relatively few major gas-producing countries. Furthermore, investment in new gas facilities has fallen back in recent years. For the UK, whose North Sea gas resources are diminishing, Norway is the pivotal supplier. Supplies of Liquified Natural Gas (LNG) are stretched, while Russian EU gas exports via Gazprom are dominated by political and legal issues relating to the divisive Nord Stream 2 pipeline.Download the full report
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