Regulated gas prices will increase by 3.5% on average in February 2021. An increase due to strong demand for liquefied gas in Asia.
A cold snap in East Asia responsible for the rise in gas prices
In a press release published on Monday January 25, 2021, the Energy Regulatory Commission (CRE) announced that the regulated gas prices applied by Engie will increase by an average of 3.5% on February 1, 2021. A sharp rise due to an unexpected cold spell in East Asia which pushed up demand and therefore the price of gas.
In detail, the price increase will not be the same for everyone. The Commission lists in its press release the various increases applied to customers ” This increase is 0.9% for customers who use gas for cooking, 2.1% for those with dual use, cooking and hot water, and 3.7% for homes that heat with gas “.
To cope with rising demand, Europe is drawing on its reserves
The strong cold snap in East Asia is forcing European countries to draw on their liquefied gas reserves. The press release from the Energy Regulatory Commission clarifies the complex situation: ” This increase for February is mainly explained by strong demand for liquefied natural gas in Asia, linked in particular to an exceptional cold spell in East Asia. (…) The result is an increase in gas prices on international markets, which leads European countries to draw on their natural gas storage. “.
This new increase in regulated gas prices comes at a time when the law provides for the gradual termination of contracts of this type for individuals by 2023. For professionals, regulated gas contracts have disappeared from the market since December 1 2020.