OIL PRICES continued to fall yesterday, after driving markets down on Monday.
Brent crude stayed below $53, the lowest it has been since 2009 and fell to as low as $50.85 during the day. Meanwhile US benchmark WTI remained below what ETX Capital strategist Daniel Sugarman termed the “psychological barrier” of $50 a barrel.
Consumers saw further benefits of this downturn in the oil market, with several major supermarkets, including Asda, Morrison’s and Sainsbury’s, announcing cuts to fuel prices at their service stations yesterday.
British petrol and diesel prices have followed the general trend of oil to come to a five-year low, with prices at the petrol pumps dipping to an average of 111.06p per litre this week, and diesel prices falling to an average of 117.93p per litre.
The UK’s consumers are also benefitting from a slump in wholesale power prices. The ICIS Power Index is now just £46.316/MWh, the cheapest it has been since July 2012. According to ICIS, falling gas prices are one of the contributing factors, as well as the fact that a warmer than usual winter last year left plenty of gas in storage.
In addition, the supply of liquefied natural gas being routed to the UK has increased due to reduced demand in regions such as Asia.
Zoe Double, head of power at ICIS, said: “This continues the downward trend in power prices that we saw over 2014, and helps to bring down the wholesale portion of household energy bills.”
However, ICIS warned that the costs of funding renewable power generation and energy efficiency measures are expected to rise further over the coming years.