After a decade-long period of growth coming out of the last financial crisis, the global economy is facing an unprecedented shock as a result of near-simultaneous lockdowns being imposed in a large number of countries globally. The drop in economic activity has been dramatic.
In the energy sector, the overall economic shock has been combined with an oil price war and has caused a significant dislocation in prices of energy commodities. Taken together, these shocks are likely to have far-reaching effects on the energy sector, with consequent effects on government policy and regulation.
Read on to explore the possible implications of the economic shock for the different parts of the UK energy sector value chain - commodity extraction, wholesale trading, electricity generation, retail and networks - and consider how the potential response of government and regulators could further affect the outcomes for different energy sector stakeholders.