During Week 26, spanning 22–28 June 2026, wholesale electricity prices rose across Southeast Europe even as European natural gas prices edged lower. TTF natural gas futures averaged €41.31/MWh, down 1.1% compared with the previous week. Weekly average power prices increased in multiple markets, including Hungary, Romania, Italy, Croatia, Serbia and Bulgaria. All six recorded weekly averages above €100/MWh.
Demand growth and weaker hydro shape dispatch needs
The week’s price pattern reflected electricity demand outpacing the limited relief from lower gas costs. Regional power demand rose 12.7% week on week to 18.41 TWh. Hydropower generation declined, while renewable output remained uneven across national markets despite stronger wind production. With cooling demand increasing, system operators leaned more on gas-fired, coal-fired and lignite-fired generation.
This shift in generation mix contributed to higher wholesale electricity prices across the region. The increased reliance on thermal units aligned with the need to cover rising load during summer conditions. As a result, pricing pressures persisted even though the benchmark fuel price moved slightly lower over the week. The divergence between gas and power markets pointed to demand and supply balance as key drivers of weekly outcomes.
TTF moves within a narrow band but stays elevated for generators
Gas trading during Week 26 remained relatively contained rather than showing a sharp drop. TTF futures reached €42.16/MWh on 23 June before easing to €40.50/MWh on 25 June and then recovering later in the reporting period. By the end of the week, the one-month forward TTF contract stood at €44.08/MWh. Fuel costs for gas-fired power plants therefore remained elevated despite the weekly decline.
Gas-fired generators continued to run as high-cost marginal units, particularly during periods of peak electricity demand. The weekly average gas price decline did not translate into lower dispatch requirements for gas plants. Instead, the market outcome corresponded with higher utilization of gas capacity during times of tight system balance. This helped keep wholesale power prices elevated across multiple countries.
Gas-to-power link shows higher volumes rather than lower fuel prices
The relationship between gas and electricity prices in Week 26 was tied to dispatch volumes rather than further reductions in gas prices. Even with a modest softening in the benchmark fuel price, regional gas-fired electricity generation increased by 25.5%. Italy showed the largest change, with gas-fired generation surging by 47.5%. The pattern indicated that higher cooling-related demand could outweigh limited improvement in fuel costs.
For market participants managing price exposure, tracking only weekly movements in TTF was described as insufficient for assessing power price risk. The relevant factors included how often gas plants set marginal prices and how demand develops during peak consumption hours. Flexibility from renewables, hydropower and cross-border interconnections also influenced outcomes during the week. Even when gas prices were stable or slightly lower, electricity prices could rise if marginal generation scarcity coincided with faster demand growth.
Implications for industrial hedging amid constrained procurement conditions
The week also highlighted how hedging approaches for industrial buyers can differ between commodities and electricity procurement. Gas price hedging and electricity price hedging were described as closely connected but not interchangeable strategies. A decline in gas prices did not automatically lead to lower electricity procurement costs when wholesale markets were constrained by high demand and increased thermal dispatch.
The determinants of wholesale electricity pricing under these conditions included the generation mix, hourly demand profile and transmission constraints affecting imports. Limited import capacity was part of the constraint set referenced for Week 26 conditions. As Southeast Europe moves further into summer, these demand patterns and system flexibility were expected to remain central to electricity price formation even if fuel markets stay relatively stable.
Elevated by Virtu.Energy