WHOLESALE OIL and gas prices increased in November, as the euro weakened against the dollar on currency markets, pushing the Bord Gáis energy index 4 per cent higher.
The index is now running 17 per cent higher than in November 2010.
Softness in the single currency following fears about its future meant the euro price of commodities increased, but the scale of the rise was curtailed by lower demand arising from reduced growth prospects and milder weather.
Tensions in the Middle East also continued to be a driver of oil prices, said Bord Gáis trading analyst Michael Kelleher.
The fragility of the global economy should take the sting out of energy prices next year, he added.
“Markets are indicating lower oil prices into 2012 as fears of a double-dip recession due to the possibility of a break-up of the euro and a weakening of the US economy in 2012,” he said.
Forward gas prices fell during November, a drop that has been attributed to the unseasonably mild temperatures during the month.
The oil element of the index was up 5 per cent during the month, largely as a result of currency movements.
The price of oil was also supported by concerns over a possible future disruption to supply due to political uncertainty in oil-producing regions, Bord Gáis said.
Natural gas prices rose 6 per cent, fluctuating throughout the month as consumption varied due to changeable weather and unstable UK production followed by increased flows of gas from Norway.
The electricity element of the index increased 3 per cent as a result of a rise in the unavailability of imported power.
This was due to a scheduled repairs outage in the electricity interconnector between Ireland and the UK.
As a consequence, Ireland had to rely on its own generation fleet to meet demand and less efficient generators were called into production. High winds also forced thermal plants out of the system on several days, giving rise to additional start-up costs when they were later required to provide electricity supply.
The final element of the index, coal, saw prices fall slightly due to a combination of factors including subdued demand and healthy stockpiles.
