Gas prices slump, but bakers must wait for lower bills

02 November, 2006
Page 4 
Most bakers say they have yet to see bills decrease despite the price of gas falling this month.
The price of natural gas through September was 26p a therm. But on October 3 this dropped to -5p a therm as traders were caught off guard by the opening of the £5.5bn Langeled pipeline from Norway to Yorkshire, which flooded the market with gas.Scottish Association of Master Bakers's chief executive, Kirk Hunter, said many bakers are locked into contracts so if the price of gas goes down they will not feel the benefits. He said: "Energy costs are one of the largest costs next to labour that bakers face and the increases over the last year have been nothing short of horrendous. The industry will be looking to gas suppliers to cut prices. We want to see companies moving quicker to reduce costs."The price of gas for delivery in January has fallen 6%. However, Ofgem has warned that it usually takes around nine months for cuts to be felt by the customer, despite 80% price increases occurring over the last three years. See next issue of British Baker for News Analysis.



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