In May, the gas bill will see a 0,2% drop compared to the previous month for families under guardianship, despite the fact that the price of the raw material has fallen. This was noted by Arera, the energy and gas market regulator, as part of the usual monthly gas update. An almost imperceptible difference, but after the maxi-inflation in April (+22,4%) is good news: in May, the gas bill remains stable despite the disappearance of the "discount" components applied by the Government, while the bad news is the burst of quotations of methane in the last two days, in the wake of fears of competition with Asia for US liquefied gas (LNG) and the rise in the price of crude oil, triggered by the OPEC+ decision to extend production cuts to 2024. But let's go in order.
The price of gas drops but the bill remains stable
In recent weeks, we have seen a decisive drop in the wholesale gas price on the international market. Yet, this will not be reflected in the bill due to the cuts in aid envisaged by the government led by Giorgia Meloni. In fact, with the latest Bollette decree, it was envisaged that the general system charges go up again and other discounts have also been reset. In particular, as recalled by the public authority that deals with energy, the VAT on gas has been kept at 5%, and system charges have also been eliminated as in the past. The difference is that a particular discount, the one on UG2 component of the bill – applied to consumption brackets up to 5.000 cubic meters per year – has been progressively zeroed. The reason? The price of energy is now at much lower levels than a year ago: in May, the price of the raw material gas in the bill will be 34,06 euros per megawatt hour for customers in protected conditions (numbers far from the peak last summer over 300 euros per megawatt hour).
The fare for the typical family
The overall update of the rate is preferably used for typical family, which has average gas consumption of 1.400 cubic meters per year, will therefore remain the same because there will be two balancing effects: the drop in expenditure for natural gas equal to -13,2% and the increase in general charges for the part linked to UG2 equal to +13%. The tariff linked to the cost of transport and measurement remained unchanged. The bill thus marks a final -0,2% for the typical family.
Gas expenditure for the average household from June 2022 to May 2023 is equal to 1.514 euros, without taking into account taxes, recording a -6,7% compared to the period June 2021-May 2022.
The price of gas in Europe is increasing: here's why
I natural gas futures in Europe they scored a rise peak of 20,2% at 28,48 euros per megawatt hour, after hitting a two-year low last week below 23 euros. But why?
Fueling the gas surge are the risks of a competition with Asia for US cargo of lng which, according to Bloomberg, will become a more profitable import destination than Europe in the coming months. US LNG exports fell to 7,66 million mt in May from a record 8,01 million mt in April, according to preliminary data from Refinitiv Eikon, as maintenance at some plants limited production and Weakening prices in Europe reduced flows to the region, while more LNG was delivered to Asia and Latin America.
Not only. Several service outages also impact this flare-up. Until the middle of this month, several shutdowns of large Norwegian gas fields are expected for maintenance works, while flows through the Turkstream pipeline, which transports gas from Russia to Turkey via the Black Sea, are suspended until June 12, again for maintenance work.
Meanwhile, on the oil market, Saudi Arabia has said it will carry out a deep production cut in July, on top of a broader OPEC+ deal to limit supply through 2024, as the group seeks to boost oil prices Petroleum down. The Saudi energy ministry said the country's production would fall to 9 million barrels per day (bpd) in July, down from around 10 million bpd in May. This is the largest reduction in recent years.
However, it is worth mentioning that inventories in Europe remain healthy, buoyed by a mild winter, large inventories and relatively weak demand.
