---

Gas Prices

Answer

The price differentials for the last three months are given in the table.

Average price in	Spot(p per therm)	Forward price for contract in quarter 4, 2005 (p per therm)	Forward price for contract in quarter 1, 2006 (p per therm)
September	27.5	50.8	68.7
October	32.7	n/a	67.2
November	80.7	n/a	81.0
n/a=Not applicable Note: That the forward contract for quarter 4, 2005 was not available after September 2005.

The choice of the type of contract to enter into is a commercial decision to be made by each firm, within the context of their own risk management strategy and balancing a number of factors.Spot prices for November were volatile and rose, in part, due to nervousness about a tight winter supply demand balance. The Government understand that this creates tough trading conditions for energy intensive users. We will continue to work closely with industry to help, wherever possible, to mitigate the situation and reduce the impact on industrial customers, particularly large users. We are in close contact with high-energy users who have been affected by the price increases.The recent price spike has not had an impact on all of industry. For example, for the less energy intensive users contracts with suppliers may be on a fixed price basis which are lower than the EU average.

Secondary information

Type

Written question

Reference

440 c1666-7W;440 c1666-7W; 33895

Session

2005-06

Subjects

Natural gas Prices

Link

View this Written question on www.publications.parliament.uk