40% fall in business gas prices:
Wood Mackenzie, the Edinburgh oil and gas industry analyst, is predicting that this winter will be the last one for years in which security of supply is a major concern for the UK. The company's senior analyst for European gas and power, Graham Tyler, said yesterday that new gas supply is likely to reduce wholesale prices by 40 per cent by 2010. He conceded that this coming winter would still see a tight market, but said the supply-demand position has now eased compared to last year by about 10 per cent. "Although we predict that UK indigenous gas production will be lower this winter, this will be more than compensated for by increased availability from imported sources," Tyler said. The agency said that supply, particularly from Norway via the new Langeled line, would underpin security of gas supply. Liquefied natural gas will also play an important role for winter supply, with the new Teesside GasPort project. "One of the key uncertainties for this winter would be an early, sustained spell of extremely cold weather," Tyler said. "But in the event of a normal winter, we see the potential for winter gas prices to ease by around 8 per cent compared with last year. "If a significant reduction in world oil prices is realised by 2009-10, then the UK's gas consumers could look forward to a gradual return to much more comfortable gas pricing levels for the medium term." If a fall by about 40 per cent by 2010 was passed on to domestic users, this would lead to an annual reduction in the gas bill for an average household of £140. 22.9.06