The Bord Gáis energy index rose by 1% in the month of January from December due to an increase in wholesale oil prices. The index stands at 144 - an increase of 8% from January last year.
Bord Gáis says the oil element of the index increased by 2% to 156 as prices continued to increase on the back of ongoing tensions between the West and Iran over its nuclear programme. The possibility of supply disruptions of oil put upward pressure on prices.
However, the natural gas element of the index fell by 3% to 184. Bord Gáis said that despite the very cold weather at the end of the month around Europe, temperatures during the month were generally mild and gas demand was relatively low for the time of year.
The coal element of the index was also lower, down 8% to 134, last month. Low demand for coal in Europe was as a result of relatively mild winter weather and already high stock levels.
The unseasonably mild winter weather has resulted in the electricity element of the index falling by 2% to stand at 117. High wind levels seen in January also meant that the electricity produced by more expensive thermal plans was substituted with cheaper electricity from wind farms over extended periods during the month.
John Heffernan, a power trader at Bord Gáis, said the upwards pressure on oil prices in January was mainly driven by market uncertainty regarding the implications of EU sanctions on Iran and the very tentative improvement in sentiment surrounding several major economies.
Mr Heffernan said the outlook for February is uncertain. ''The ongoing discussions on Greek's national debt have the potential to lower economic expectations and lead to a fall in prices, although this could be offset if the current cold weather snap continues and leads to a depletion in stocks of coal and gas,' he added.
