The war between Hamas and Israel is already being felt in world energy markets. Natural gas has increased by 44.6 percent since Saturday, October 7, when the conflict in Gaza began. 55.3 euros per megawatt hour (MWh) in the European reference marketDutch TTF. A barrel of Brent oil is Last week, it gained 7.7 percent in value, reaching $91 per barrel..
The increase in natural gas explains the recent rise in electricity prices to high levels not seen since March. The average electricity price for regulated tariff customers will rise to 141.05 euros per megawatt hour (MWh) on Monday, October 16, an increase of 6.7% compared to this Sunday. This also means: 42.3 percent increase compared to the price paid by consumers on the day the war began99.16 Euro/MWh.
According to time periods, the maximum price users will pay this Monday will reach: 220 Euro/MWh between 19:00 and 20:00According to provisional data from the Iberian Energy Market Operator (OMIE), the minimum price will occur between 4 and 5 hours at 110.24 euro/MWh.
Natural gas is key to the Spanish electricity mix as it represents around 30%. The proportion of energy sources used to generate electricity in Spain between combined cycle plants and cogeneration, where biomass and other renewable sources are also used, according to data from Red Eléctrica de España (REE).
The increase in the price of this raw material comes at a time when Israel has ordered the closure of a natural gas field managed by the American company Chevron on the country’s coast for security reasons. Experts also add that there is a tear. Gas pipeline in Finland may not be operational until early 2024could later lead such a rally two weeks of decline.
‘Iberia exception’ does not apply
The electricity market average so far in October is around 115.7 euro/MWh, compared to 143.08 euro/MWh recorded by the pool in the same period in October 2022.
Last September closed with an average of 103.3 euro/MWh, compared to 141.07 euro/MWh recorded by the pool in September 2022, making it the most expensive month since February 2023.
This exception, called the ‘Iberian exception’, will be in force until December 31, following the agreement reached by Spain and Portugal with the European Commission. But, This mechanism has had no impact on the electricity market since the end of February. Due to the fact that the price of natural gas falls below the thresholds established for its application.
Added to the average price of the ‘pool’ is the compensation payable to consumers who benefit from the measure, regulated tariff (PVPC) consumers or gas companies despite being in the regulated tariff. There is an indexed rate in the free market, but this rate is once again at 0 Euro/MWh, this situation has been repeated since last February 27.