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National Grid’s share price is down slightly in the early hours of today’s trading session, continuing the 2.5% decline seen yesterday.
This drop comes amid reports that the company has extended its annual emergency gas shortage drill from two to four days. This drill is designed to simulate decision-making processes for determining which customers will have to reduce or cut their gas consumption during a crisis.
There are also growing concerns about rising energy costs in the UK. Consultancy firm Auxilione has suggested that the energy price cap could soar to as high as £6,500 per year by April. Additionally, National Grid has developed plans to offer up to £5 million in payments this winter to incentivize companies and factories to reduce energy use by cutting production. Companies that do not participate in this scheme could face compulsory gas rationing.
The recent decline in National Grid’s share price reflects the challenges the company faces due to high demand, rising gas prices, and limited gas supply. As these issues persist, there is a strong likelihood that the share price will continue to fall in the coming sessions.
Based on the current price action, it’s likely that National Grid’s share price could drop below the 1,140 level in the near future. There’s also a possibility that the price could decline further, potentially reaching the ascending trend line, making a move below the 1,100 level a realistic scenario.
However, if the share price moves above yesterday’s opening price of 1,177p, this bearish outlook would be invalidated.