The Bord Gáis Energy Index (BGEI), an Irish-specific index designed to measure the prices in the wholesale energy markets, fell by 2% in August to 108.

This is the first time that the Energy Index has dropped out of the 110 to 112 range since April 2010. Currency movements again had an impact in August with the euro giving back some of the gains made in July versus the US dollar. This prevented the Energy Index falling further to the 106 mark.

The index is designed to track movement in the wholesale energy markets and comprises the four key energy commodities of oil, gas, coal and electricity. The index tracks the monthly price movements of these commodities, factoring in any currency shifts, and producing an overview and insight into the energy sector. Launched in May of this year, the new energy index is the first initiative of its kind in the Irish market according to the State gas company.

• The price of oil fell in August from $78 to $74 per barrel.
• The price of natural gas proved to be the biggest mover in August as prices fell by 7% in Euro terms, due to reduced storage injections in the United Kingdom.
•  Prices in the coal market initially rose in August on the back of increased German power prices and reached a high of $93 a tonne in early August. However, high stockpile levels in Europe and decreased demand from China, contributed to the fall in coal prices from the early highs and coal closed at $91 a tonne at the end of the month.
• Electricity prices fell by 2% during August. Demand levels in August remained at similar levels to June and July, however the there were signs of growth in evening time demand as we leave the summer period.
• The recovery of the euro continued in the early part of August but those gains were eroded and it ended August at US$1.26 and STG£0.82. Currencies continue to be influenced by macro economic data in light of the uncertain global economic recovery.
• Combined movements in the prices of the four commodities of natural gas, coal, oil and electricity resulted in a decrease in the energy index of 2% on July’s figures. The index now stands at 108.