Market Outlook

The front-year product on the power market, Base 2024, initially experienced a strong downward movement this year, trading down to values of around 115 EUR/MWh by the beginning of June. At the beginning of the summer, prices rose again as a result of warm temperatures, dry periods in many European regions and low gas deliveries - but from then on remained in a range mostly well below 150 EUR/MWh. This range was also supported by high feed-in values from renewable energies in some cases.  

However, the situation changed with the Hamas attack on Israel and the leak in the gas pipeline between Finland and Estonia - uncertainty in the market increased across the entire commodity complex. Conflicts in the Middle East, with high crude oil inventories there, are putting transportation routes at risk, and a spread of the conflict could have serious consequences for oil supplies. In particular, Iran's threat to block the important Strait of Hormuz caused unrest. About 20% of the world's crude oil is transported via this route. In addition to oil prices, gas and CO2 quotations also rose.

As a result, Cal 24 in the power market reached its current high of EUR 139/MWh in mid-October.

Outlook

In the electricity market, the fundamentals paint a mixed picture: Following the attack on a hospital in the Gaza Strip, there are growing fears that the situation will deteriorate. This is countered by the above-average feed-in of renewables and signs of rather mild weather in the coming months.

There are also opposing trends in the gas market: The Middle East conflict with all its dangers has a bullish effect, while the filled gas storage facilities and mild weather prospects tend to dampen the trend.

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