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Javier Blas

Europe's Heat Wave Is Bad for Energy Prices, But the Drought Is Worse

Falling water levels are exacerbating Europe’s energy crisis.

Too hot to handle.

Too hot to handle.


Europe is sweltering under a heat wave that has pushed temperatures above 40 degrees Celsius (104 degrees Fahrenheit) in several countries. As households and businesses turn on their air conditioners, electricity demand has jumped and wholesale power prices have surged. But far more concerning — and far less discussed — is the drought spreading from Germany to Portugal that has the potential to worsen the current energy crisis for a lot longer than the current hot spell.

The drought is a gift from nature for Vladimir Putin, making Europe even more reliant on Russian natural gas at a time when the Kremlin is reducing supply sharply. Last winter, the weather favored Europe, as unseasonably high temperatures during the Christmas holidays cut demand for energy; now, the lack of rain is working against the continent.