With gas and oil prices falling to an all-time low, the ‘Big Six’ suppliers are under renewed pressure to cut energy prices. This follows on from new data that implied that GREXIT (Threat of exit of Greece from Europe) had helped in pushing energy, and in particular wholesale gas prices to their lowest level , since the first quarter of 2010. Greece, having almost decided to abandon the Euro, (even though a turnaround has made this now seem unlikely in the short term,) plus low oil prices worldwide, has exacerbated the situation. Wholesale gas prices fell to an average 47.1p per therm between April and June, with power down to £44.72 per megawatt hour.
Energy prices here in the U.K. have also been pushed down by these concerns, as the value of the euro has dropped compared to sterling. However gas from the U.K. has become more expensive for European purchasers and as a consequence is much less in demand. It is suggested that the big energy suppliers could still afford double-digit reductions in their prices.
Despite the current wholesale prices of energy being low, it is not certain that it would keep falling, the United Kingdom has a lot less gas in storage than they hand a year ago, and if problems are compounded with general supplies on the continent of Europe, it could be depleted further, if the demand for U.K. gas increases.
This new demand for price reductions comes ahead of the publication of findings of the Competition and Markets Authority investigation. This watchdog is expected to make a statement that millions of homes are paying hundreds of pounds per year above what they should be, because they have stayed with a standard tariff, instead of looking around and switching to a better deal.
Energy costs at present stand for around half of our yearly bills, but despite the “big six” energy companies reacting earlier in the year, and reducing their prices, it is not enough for many observers, who feel that a lot of people are struggling to pay their fuel bills.
Almost four million UK households are in debt to their energy supplier, with the average amount standing at £130 per home. In all, consumers are in debt to energy companies to the tune of half a billion pounds, this is an increase of around 9% on the previous year. The annual fuel bill now approximates to around £1,237, with at least 4.5 million families classed as “fuel vulnerable”, in other words those who are spending more than £1 out of every £10 of their income on energy.
Lawrence Slade, chief executive of Energy UK, advised consumers to use energy switching sites, stating:
“Energy companies are bringing down prices across all their tariffs as fast as possible, so customers should use any of the many switching sites to check they are on the right deal for them.”
Energy Switcheroo has a dedicated staff who can help you with all aspects of switching your energy supplier.