Electricity.Trade concludes that January 2026 provided a clear illustration of cross-commodity transmission from gas into power markets. As TTF volatility intensified, gas-heavy electricity systems repriced rapidly, while hydro-insulated markets diverged.
Italy, Hungary, Romania, and Bulgaria experienced elevated power prices aligned with gas expectations rather than immediate supply-demand balances. Italy averaged €132.67/MWh, Hungary €150.41/MWh, Romania €150.51/MWh, and Bulgaria €148.55/MWh, reflecting gas-linked marginal pricing.
In contrast, Greece and Serbia temporarily decoupled due to hydro surpluses. Electricity.Trade notes, however, that this decoupling did not disrupt regional convergence permanently. Once hydro conditions normalize, gas volatility is expected to reassert dominance.
January reinforced a fundamental Electricity.Trade conclusion: gas remains the primary marginal driver of electricity prices across much of Europe and South-East Europe. Cross-commodity risk management is therefore no longer optional but essential.
Elevated by virtu.energy
