Bad news for Irish households as price of oil and gas rise on wholesale markets

European wholesale gas prices soared more than 30% on Tuesday.

Irish households potentially received a double whammy from global energy costs as the price of crude oil rose and European wholesale gas soared on markets on Tuesday.                               

Oil prices rose 1.5% as the group of Opec+ producers agreed to stick with their planned increase for February based on indications the Omicron coronavirus variant would have only a mild impact on demand.

Brent crude traded above $80.13 a barrel, its highest since November. 

European wholesale gas prices also soared more than 30% on Tuesday after low supplies from Russia reignited concerns about an energy crunch as colder weather approaches.

Higher prices for the fuel boosts oil demand as utilities switch to burning crude, rather than natural gas.

"The oil market is bullish today as a result of optimism sourced from today's monthly Opec+ meeting, which is helping oil prices trade higher," said Rystad Energy's head of oil markets Bjornar Tonhaugen.

Opec+ agreed to stick to its planned increase of 400,000 barrels per day in oil output in February. Its decision reflects easing concern of a big surplus in the first quarter. 

"It appears that the market is making the bet that Omicron is the beginning of the end of Covid-19," said Scott Shelton, an energy specialist at United ICAP. 

• Reuters and Irish Examiner