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Opinion
Javier Blas

Bigger Shocks Are Coming With Your Electricity Bills

Forward contracts are baking-in huge price increases for the UK and Europe.

Lightning Strikes Over London Skyline
Photographer: Dan Kitwood/Getty Images Europe

An oil crisis hits the economy like a big wave breaking on the beach: The impact is immediate and dramatic as the crest plunges onto the shore. An electricity crisis is another kind of shock: Akin to a rising tide, it is slow but relentless and then, surprise, you are overwhelmed.

The difference explains why policymakers and investors focus on oil and tend to ignore electricity. That’s a big mistake because another big predicament over electricity prices is coming, not unlike the one Europe weathered late last year.