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Oil markets drop to lowest levels in year and a half

Close price: Little overall movement by market close yesterday, as prices consolidate their position. Oil has seen something of a flash crash over the last few days, now trading at $96/barrel, its lowest value since Feb 2021. This was led from an unexpected build up in U.S inventories and OPEC+ announcing an increase of 100,000bpd of production. Despite the drop, gas and power prices were unmoved, demonstrating serious resilience in valuations.  

Opening price: Prompt prices are trading higher this morning, given that the UK gas system is 12mcm short. Wind generation, which was as high as 45% of energy mix yesterday, is now down to 10%, as wind levels fluctuate quite widely. The Turbine situation is still as it was, with Siemens and Russia at a stalemate.

Growing tensions over Taiwan is something to keep an eye on. We saw the impact the trade war between U.S.A and China had on the markets in 2018, and relationships are far from okay between the nations once more.

2022 continues to be an unforgettable year, they will look back on in years to come.