If futures have any value in a market panic, the messages they send are not positive.

You need to arrive by the summer of 2024 to find a contract at a price below 200 euros.

According to futures contracts on the Dutch Energy Exchange, natural gas prices will remain above 300 euros per MWh until at least February 2023 and steadily above 250 euros until the end of next year.

You need to arrive by the summer of 2024 to find a contract at a price below 200 euros. And this despite the fact that in September last year the price of natural gas was below 48 euros per megawatt-hour.

The panic of the last days is caused by a combination of two factors. Russia is once again shutting down Nord Stream 1 for a few days for maintenance, raising uncertainty as to whether they will resume it, and if so, when.

At the same time, France’s nuclear units have cut production for technical reasons. Currently, 30 EDF reactors with a total capacity of 25 GW have been decommissioned, and the shutdown of another 20 reactors for maintenance in the dead of winter (December-March 2023) will reduce France’s available nuclear capacity by another 6-8 GW. causing significant power shortages.

But since France, with its nuclear power industry, is an exporter of electricity, electricity prices have jumped not only in the domestic market, but also in all interconnected markets. Greece, by the way, was not affected.

And this is because on August 24 the connection with Italy was interrupted due to a malfunction.

When the fault is repaired (estimated on September 3rd), some of these pressures will reach the Greek market through the interconnection, and through the Greek market – interconnected with Greece – Bulgaria.

The re-opening of the cable will allow 500 MW to be exported to Europe’s most expensive market, driving up prices in Greece.

The effect of September’s natural gas price increase will be reflected in electricity prices in October, and this is because electricity producers in Greece set prices based on the average price of the previous month, unlike in Europe where prices are set daily, resulting in any fluctuations in the price of gas are automatically transferred to the wholesale price of electricity.

Finally, a decrease in RES production during the two months from September to October and its replacement mainly by expensive natural gas, since lignite is already operating at maximum capacity, will push prices to more than 500 EUR/MWh in the next period.