The cost of gas-fired power in the EU increased by more than 50% in the first ten days of the Middle East conflict.

This is according to global energy think tank Ember which reported in a March 13 statement that European gas prices averaged €45/MWh in the first week of the conflict compared with pre-conflict levels of €31/MWh. Ember’s analysts conclude that as prices jumped, the EU paid an additional €2.5bn for fossil fuel imports in the first ten days of the conflict.

The increase in gas prices has a knock-on effect on the cost of gas-fired power, with the strongest effects being felt in those countries where there is a higher reliance on gas for electricity production and power system flexibility. Spain, for example, decoupled gas and power prices amid rapid wind and solar growth since 2019. In the first ten days of the conflict, average power prices in Spain remained below the cost of gas-fired power, and lower than other EU countries with large gas power fleets. In the first week of March, power prices rose to their highest levels of the year in Germany, Netherlands, Italy and Belgium. Less gas-reliant countries such as Spain, Portugal, France and the Nordics appear less impacted.

See also Iran war fallout lands hardest on Europe’s most gas‑dependent nations (Reuters).