It wasn’t so long ago that newly appointed energy secretary Amber Rudd called on the UK’s big six energy suppliers to cut retail energy prices, arguing – rather sensibly – that without the threat of the much-mocked Labour price freeze pledge, those tumbling wholesale prices should be passed on to the end consumer.
As early indicators go, Rudd’s insistence that the evidence-based market weakness is something that benefits consumers suggests she might be the right person for the Department of Energy and Climate Change.
In early June – when Rudd first called on suppliers to cut prices in line with costs – wholesale gas prices for this winter had tumbled to a fresh low of 47.75p/th, well below the pre-Brent crash levels over 80p/th in 2011.
But since then, Rudd’s admirable calls have been met with a stony silence from the big six. In public at least. And in the background gas prices have kept trending lower, with the market shrugging off concern over any possible supply disruption stemming from matters geopolitical or geological. Russia can sabre rattle and the Dutch can cut gas production for fear of earth tremors, but with the steady stream of LNG cargoes making their way to UK shores, traders are relaxed.
And apparently so are the energy companies. You’d assume that with the scrutiny of the Competition and Market Authority still weighing on the minds of the big six, there’d be a strong incentive to prove how much healthy competition there really is. Not as strong as the incentive of weighty profits, it seems.