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    The gas contracts signed in Spain include a new price increase of almost 40% in 2023.


    October 5, 2022 - CE Noticias Financieras

     

      From the 97 euros signed for November of this year, to the 133.82 euros of the contracts closed in the Iberian Gas Market for 2023. The current market trend shows a drop in the price of natural gas from October to November, from the current 107.24 E/MWh to 97 E/MWh. But the markets do not consider gas tensions to be over this year, far from it. So much so that they are once again picking up a sharp rise of almost 40% from November until next year.

      A rise in the cost of gas, to be precise, of 38%. That is the forecast set out by the operators of MIBGAS, the Iberian Gas Market, for 2023. And the market shows this evolution while the Spanish Government prepares budgets with tax increases, while the EU prepares punishments to energy companies and while Pedro Sánchez shoots up spending in the accounts for 2023. In other words, just the opposite of what all operators, companies and households need to better adapt to this new price increase.

      The price evolution estimated by the Iberian market at this time includes a first drop in the cost of gas to 97 E/MWh next November. Subsequently, this index discounts a rise to 127.36 E/MWh in the first quarter of 2023. And an average price stabilization for the whole year 2023 at 133.82 E/MWh.

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      Not even in 2024 does the Iberian market see a clear drop in the price of gas: it leaves it, according to the contracts closed at the moment, at 101.01 E/MWh.

      And that is very bad news. Because that price is already destroying business activity and the purchasing power of families. And it will continue to do so for too long. The first warning of the collapse of gas consumption by the industry and large Spanish companies was shown last June, as reported by Libertad Digital. In the midst of all the hyper-optimistic announcements of Pedro Sánchez's government talking about a supposedly "robust" recovery, large gas consumers certified that the economy was plunging into a standstill and showed average drops in gas purchases of between 10% and 20%, with sectors that came to reflect a year-on-year drop in consumption of almost 40%.

      And the month of July has aggravated the situation considerably, bringing the falls to an average level of 31.8%, with three sectors completely slowed down: textiles, electricity generation with natural gas and refining. Their falls are between 44% and 58% and confirm that Sánchez's messages were pure propaganda. And, meanwhile, the president continues to announce more taxes, increases in social contributions and increases in the labor costs of companies.

      The consumption of natural gas by large companies and industry is a leading economic indicator that is difficult to manipulate by politicians and that shows with great accuracy the real level of activity that these companies have and plan to have. If they do not spend on natural gas in their factories or companies, it means that activity has begun to fall and they do not foresee an upturn in consumption. If this gas expenditure plummets, then large industry is preparing for a major crisis.

      And the price continues with a clear upward trend, as discounted by the contracts closed so far with a view to the coming years.

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