NEI's Energy Markets Report - January 14-January 18, 2008

Here's a summary of what went on in the energy markets last week:

Electricity peak prices increased $22-32/MWh at the Entergy and NEPOOL hubs. The four other hubs increased $8-10/MWh. Cold weather at the end of last week was to blame for the increased electricity prices (Platts, see pages 1 and 3).

Gas prices at the Henry Hub increased $0.51 to $8.27/MMBtu due to colder temperatures. This is the second highest weekly price over the past 12 months. Plentiful supplies of natural gas in storage and declining crude oil prices likely mitigated the extent of the price increases at many market locations (EIA, see pages 1 and 3).

Estimated nuclear plant availability remained at 94 percent last week. Grand Gulf 1 scrammed due to an electrical failure with the transformer cooling system. Palisades was shut down after one of its two main feedwater pumps tripped. Point Beach 1 declared an unusual event after an electrical transformer malfunctioned. Sequoyah 1 manually tripped due to lowering steam generator level. Palo Verde 3 was back online last week after being down for 109 days to replace its two steam generators (Platts and NRC, see pages 2 and 4).

Crude oil prices fell $3.40 from the previous week to $94.76/barrel. In recent months, the nominal price for crude oil has reached its highest level ever. However, as a percent of disposable income, today’s energy prices are still below the peak reached in 1981. During the third quarter of 2007, consumers spent an estimated 5.7 percent of their disposable income on energy versus 8.2 percent in the second quarter of 1981. In 1981, motor gasoline and fuel oil accounted for 64 percent of energy expenditures by consumers similar to the third quarter 2007’s share at 62 percent (EIA, see pages 1 and 3).

Uranium spot prices fell to $86 and $84/lb U3O8 last week according to UxConsulting and TradeTech. According to TradeTech, one seller last week successfully adopted a more aggressive approach offering uranium at deeply discounted prices to attract buyers (see pages 1 and 3).

For the report click here. It is also located on NEI's Financial Center webpage.