European winter power premium highest since 2022 on gas and hydro
The forward spread between winter and baseload power has widened to its largest gap in three years, per Reuters.
By Matthias Blank · drafted with the Vantage newsroom system, approved before publication
The European winter power price premium has reached its widest point since 2022, according to Reuters. Gas supply constraints and hydro shortfalls are the named drivers, not a demand surge.
RTE's 2025 price review, published in April 2026, corroborates the elevated wholesale environment in France. The confluence of tight gas balances and low reservoir levels across southern and central Europe removes the buffer that typically suppresses winter spreads in shoulder months.
For traders pricing the winter 2026–27 strip, the widening spread raises the cost of open short positions. Load-serving entities in CWE and Iberia face higher mark-to-market exposure on unhedged winter volumes. The hydro deficit component is particularly relevant for Iberia and the Alpine zones, where reservoir drawdown rates have outpaced historical norms.
No reversal catalyst is visible in near-term forecasts. Until gas storage injection rates accelerate or hydro inflows recover materially, the winter premium is structurally supported, per the Reuters data.
Source: Reuters Energy
Photo by Maxim Hopman on Unsplash.
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