Latest news with #pre-Ukraine
South Wales Argus
23-05-2025
- Business
- South Wales Argus
Ofgem Energy Price Cap: Energy bills to fall in July 2025
The decrease means that a typical household in England, Scotland and Wales will now pay £1,720 on average for energy, down from £1,849under the current price cap. Energy regulator Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets. It's worth noting that the cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will always pay more. While a saving is welcome news, average energy bills continue to be 10% higher (almost £150) than this time last year, and 65% (almost £700) above winter 2020/21 levels and a third higher (around £450) than pre-Ukraine invasion. Simon Francis, coordinator of the End Fuel Poverty Coalition, says: 'The Government's u-turn on the Winter Fuel Payment is a clear sign it knows people are struggling with energy bills – but sticking-plaster solutions won't keep people warm next winter or the one after that. 'While bills may fall slightly in July, they're still significantly higher than before the energy crisis and remain tied to the unpredictable cost of fossil fuels. Without urgent reform and real investment, millions will continue to face unaffordable bills and cold homes. 'The Warm Homes Plan offers a long-term fix: lower bills, warmer homes, and greater energy security. But this essential plan is now under threat. If Ministers walk away from it, they are effectively condemning households to years more of hardship. 'Short-term relief must not be used as an excuse for long-term neglect. The Government must fully fund the Warm Homes Plan and deliver the reforms needed to bring down bills for good.' Before the announcement, consultancy BFY Group predicted that the cap would fall by approximately £1,715 – a £134 decrease from the current April cap. Matt Turner-Tait, Senior Manager at BFY Group, says: 'This shows a decrease of about £134 from the current level of £1,849, set in April. "This reflects recent declines in wholesale gas and electricity prices and will provide some short-term relief for households on standard variable tariffs. While energy prices typically dip in summer due to reduced demand, market signals indicate that prices could stay at current levels through the winter as well, challenging expectations of the usual seasonal rebound. "Adjustments to the amount suppliers are allowed to recover for operating costs could reduce bills by up to £15 per year, but these savings could be offset by the rising bad debt among suppliers and other pressures, such as volatile wholesale markets, the rising costs of decarbonisation, inflation-driven operational expenses and regulatory compliance. More energy customers have been switching to fixed tariffs, which are always cheaper than the Price Cap, and are currently significantly so - by around £250 to £300 for a typical customer. Matt says: "While the gap between fixed deals and the capped rate may narrow as the Price Cap falls, fixed tariffs are still expected to offer savings in the near term."
North Wales Chronicle
23-05-2025
- Business
- North Wales Chronicle
Ofgem Energy Price Cap: Energy bills to fall in July 2025
The decrease means that a typical household in England, Scotland and Wales will now pay £1,720 on average for energy, down from £1,849under the current price cap. Energy regulator Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets. It's worth noting that the cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will always pay more. While a saving is welcome news, average energy bills continue to be 10% higher (almost £150) than this time last year, and 65% (almost £700) above winter 2020/21 levels and a third higher (around £450) than pre-Ukraine invasion. Simon Francis, coordinator of the End Fuel Poverty Coalition, says: 'The Government's u-turn on the Winter Fuel Payment is a clear sign it knows people are struggling with energy bills – but sticking-plaster solutions won't keep people warm next winter or the one after that. 'While bills may fall slightly in July, they're still significantly higher than before the energy crisis and remain tied to the unpredictable cost of fossil fuels. Without urgent reform and real investment, millions will continue to face unaffordable bills and cold homes. 'The Warm Homes Plan offers a long-term fix: lower bills, warmer homes, and greater energy security. But this essential plan is now under threat. If Ministers walk away from it, they are effectively condemning households to years more of hardship. 'Short-term relief must not be used as an excuse for long-term neglect. The Government must fully fund the Warm Homes Plan and deliver the reforms needed to bring down bills for good.' Before the announcement, consultancy BFY Group predicted that the cap would fall by approximately £1,715 – a £134 decrease from the current April cap. Matt Turner-Tait, Senior Manager at BFY Group, says: 'This shows a decrease of about £134 from the current level of £1,849, set in April. "This reflects recent declines in wholesale gas and electricity prices and will provide some short-term relief for households on standard variable tariffs. While energy prices typically dip in summer due to reduced demand, market signals indicate that prices could stay at current levels through the winter as well, challenging expectations of the usual seasonal rebound. "Adjustments to the amount suppliers are allowed to recover for operating costs could reduce bills by up to £15 per year, but these savings could be offset by the rising bad debt among suppliers and other pressures, such as volatile wholesale markets, the rising costs of decarbonisation, inflation-driven operational expenses and regulatory compliance. More energy customers have been switching to fixed tariffs, which are always cheaper than the Price Cap, and are currently significantly so - by around £250 to £300 for a typical customer. Matt says: "While the gap between fixed deals and the capped rate may narrow as the Price Cap falls, fixed tariffs are still expected to offer savings in the near term."
Glasgow Times
23-05-2025
- Business
- Glasgow Times
Ofgem Energy Price Cap: Energy bills to fall in July 2025
The decrease means that a typical household in England, Scotland and Wales will now pay £1,720 on average for energy, down from £1,849under the current price cap. Energy regulator Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets. It's worth noting that the cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will always pay more. While a saving is welcome news, average energy bills continue to be 10% higher (almost £150) than this time last year, and 65% (almost £700) above winter 2020/21 levels and a third higher (around £450) than pre-Ukraine invasion. Simon Francis, coordinator of the End Fuel Poverty Coalition, says: 'The Government's u-turn on the Winter Fuel Payment is a clear sign it knows people are struggling with energy bills – but sticking-plaster solutions won't keep people warm next winter or the one after that. 'While bills may fall slightly in July, they're still significantly higher than before the energy crisis and remain tied to the unpredictable cost of fossil fuels. Without urgent reform and real investment, millions will continue to face unaffordable bills and cold homes. 'The Warm Homes Plan offers a long-term fix: lower bills, warmer homes, and greater energy security. But this essential plan is now under threat. If Ministers walk away from it, they are effectively condemning households to years more of hardship. 'Short-term relief must not be used as an excuse for long-term neglect. The Government must fully fund the Warm Homes Plan and deliver the reforms needed to bring down bills for good.' Before the announcement, consultancy BFY Group predicted that the cap would fall by approximately £1,715 – a £134 decrease from the current April cap. Matt Turner-Tait, Senior Manager at BFY Group, says: 'This shows a decrease of about £134 from the current level of £1,849, set in April. "This reflects recent declines in wholesale gas and electricity prices and will provide some short-term relief for households on standard variable tariffs. While energy prices typically dip in summer due to reduced demand, market signals indicate that prices could stay at current levels through the winter as well, challenging expectations of the usual seasonal rebound. "Adjustments to the amount suppliers are allowed to recover for operating costs could reduce bills by up to £15 per year, but these savings could be offset by the rising bad debt among suppliers and other pressures, such as volatile wholesale markets, the rising costs of decarbonisation, inflation-driven operational expenses and regulatory compliance. More energy customers have been switching to fixed tariffs, which are always cheaper than the Price Cap, and are currently significantly so - by around £250 to £300 for a typical customer. Matt says: "While the gap between fixed deals and the capped rate may narrow as the Price Cap falls, fixed tariffs are still expected to offer savings in the near term."
Rhyl Journal
23-05-2025
- Business
- Rhyl Journal
Ofgem Energy Price Cap: Energy bills to fall in July 2025
The decrease means that a typical household in England, Scotland and Wales will now pay £1,720 on average for energy, down from £1,849under the current price cap. Energy regulator Ofgem changes the price cap for households every three months, largely based on the cost of energy on wholesale markets. It's worth noting that the cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will always pay more. While a saving is welcome news, average energy bills continue to be 10% higher (almost £150) than this time last year, and 65% (almost £700) above winter 2020/21 levels and a third higher (around £450) than pre-Ukraine invasion. Simon Francis, coordinator of the End Fuel Poverty Coalition, says: 'The Government's u-turn on the Winter Fuel Payment is a clear sign it knows people are struggling with energy bills – but sticking-plaster solutions won't keep people warm next winter or the one after that. 'While bills may fall slightly in July, they're still significantly higher than before the energy crisis and remain tied to the unpredictable cost of fossil fuels. Without urgent reform and real investment, millions will continue to face unaffordable bills and cold homes. 'The Warm Homes Plan offers a long-term fix: lower bills, warmer homes, and greater energy security. But this essential plan is now under threat. If Ministers walk away from it, they are effectively condemning households to years more of hardship. 'Short-term relief must not be used as an excuse for long-term neglect. The Government must fully fund the Warm Homes Plan and deliver the reforms needed to bring down bills for good.' Before the announcement, consultancy BFY Group predicted that the cap would fall by approximately £1,715 – a £134 decrease from the current April cap. Matt Turner-Tait, Senior Manager at BFY Group, says: 'This shows a decrease of about £134 from the current level of £1,849, set in April. "This reflects recent declines in wholesale gas and electricity prices and will provide some short-term relief for households on standard variable tariffs. While energy prices typically dip in summer due to reduced demand, market signals indicate that prices could stay at current levels through the winter as well, challenging expectations of the usual seasonal rebound. "Adjustments to the amount suppliers are allowed to recover for operating costs could reduce bills by up to £15 per year, but these savings could be offset by the rising bad debt among suppliers and other pressures, such as volatile wholesale markets, the rising costs of decarbonisation, inflation-driven operational expenses and regulatory compliance. More energy customers have been switching to fixed tariffs, which are always cheaper than the Price Cap, and are currently significantly so - by around £250 to £300 for a typical customer. Matt says: "While the gap between fixed deals and the capped rate may narrow as the Price Cap falls, fixed tariffs are still expected to offer savings in the near term."
Mint
22-04-2025
- Business
- Mint
BPCL, HPCL, Indian Oil shares get bearish calls from analysts despite falling crude oil prices. Here's why
Indian Oil Corporation (IOC), Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL) shares - the state-run Oil Marketing Companies (OMC) - have received bearish views from analysts despite the recent sharp fall in crude oil prices, that touched a four-year low due to global growth concerns Analysts expect the high auto fuel marketing margins of Indian OMCs may not sustain for long, as the government is likely to hike the excise duty on petrol and diesel prices. Further, they believe the risk-reward is not favorable, given the overhang of LPG under-recoveries, risks to the sustainability of the Russian crude discount, and their aggressive capex plans. Domestic brokerage firm JM Financial, in its latest report, stated that sustained lower crude prices could boost OMCs' auto-fuel marketing margins. At the spot crude price of $66 per barrel, OMCs' auto fuel marketing margin has jumped to ₹ 11 per liter, compared to the historical ₹ 3.5 per liter (or ₹ 5.1 per liter, adjusting for LPG losses). However, the brokerage believes this is unlikely to be sustained at these high levels in the medium to long term, as historical precedent suggests the government is likely to hike the excise duty on petrol/diesel and/or cut petrol/diesel prices if crude prices remain low. Further, JM Financial noted that OMCs' high marketing margins are likely to be partly offset by potential downside risks to GRMs if the tariff war leads to reduced global oil demand. Citing CMIE data, the brokerage said that the discount on Russian crude to India moderated further month-on-month to USD 1.1/bbl in January 2025, down from USD 2.6/bbl in December 2024 — much lower than the USD 6–10/bbl discount seen in 1HCY23. However, Russia's share of India's crude imports strengthened MoM to 36.4% in January 2025, up from 32% in December 2024 (compared to 20% in December 2022 and just 1–2% pre-Ukraine invasion). During IOCL's 3QFY25 concall, the management shared that the Russian crude discount had come down to USD 1–1.5/bbl in 4QFY25TD (from ~USD 3/bbl in 9MFY25). Further, all three OMCs' managements stated that the Russian crude proportion had started moderating to 25–30% (from 30–35% earlier), and there is a possibility of a further decline in Russian crude supply going forward due to US sanctions. However, they added that it was premature to say whether US sanctions would lead to a complete end of Russian crude imports for Indian refiners. The brokerage has a 'Sell' rating on HPCL share price with a target price of ₹ 320 per share and on IOCL share price with a target price of ₹ 125, while maintaining a 'Hold' rating on BPCL share price with a target price of ₹ 295. It believes that OMCs' integrated refining-cum-marketing margins will normalize around historical levels, as the government may retain the benefit of any sustained fall in crude prices through excise duty hikes and/or fuel price cuts to pass on the benefit to end consumers. Further, the brokerage stated, 'OMCs' aggressive capex plans accentuate our key structural concern, as many of these projects fail to create long-term value for shareholders. At current market prices: a) HPCL is trading at 1.3x FY27 P/B (vs. its historical average of 1.0x); b) BPCL is at 1.2x FY27 P/B (vs. an average of 1.4x); and c) IOCL is at 0.9x FY27 P/B (in line with its historical average of 0.9x)'. The brokerage maintains a BUY rating on Oil India (unchanged target price of ₹ 500) and ONGC (unchanged target price of ₹ 290), based on its Brent crude price assumption of USD 70/bbl (while the current market price is discounting USD 55/bbl of net crude realization). The bullish stance is also supported by a ~12%/25% production growth outlook over the next 1–3 years. According to the brokerage, Oil India's earnings growth is likely to be aided by the expansion of the NRL refinery from 3 mmtpa to 9 mmtpa by December 2025, supported by management's guidance that excise duty benefits will continue for the expanded capacity as well. 'However, ONGC/Oil India's earnings will be negatively impacted if Brent crude prices sustain below USD 70/bbl. Every USD 5/bbl decline in net crude realization could lead to an 8–11% decline in FY26 EPS and valuation,' the brokerage noted. Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions. First Published: 22 Apr 2025, 09:31 AM IST
