Between market volatility, El Niño, and geopolitical tensions: what should be monitored in the energy market?

Between market volatility, El Niño and geopolitical tensions: what should be monitored in the energy market?

The geopolitical context remains particularly unstable and uncertain
+++ more tensions and volatility for all commodities

The price of electricity in France, although volatile (especially on the spot market), remains protected from the effects of the crisis thanks to:

– good energy availability
– available nuclear electricity
– high-performing intermittent energy sources

– electricity demand that remains moderate
– expected electrification not occurring as quickly as anticipated

This month of May, marked by public holidays, represents an area of uncertainty:

low activity may limit trading and push prices upward

the market may stabilize while awaiting a return to normal activity levels

This event nevertheless remains temporary.

In the medium term, the potential El Niño phenomenon for summer 2026 is being closely monitored by markets: they reacted immediately to announcements about its likelihood

If El Niño is confirmed, we should expect:
– an increase in Pacific Ocean surface temperatures
– an impact on temperatures across the entire Earth
– lesser effects in Europe but warmer and drier weather to be expected

This phenomenon could have concrete effects on energy supply and demand (and therefore on prices in France):
– increased electricity demand to power air conditioning
– limited cooling capacity of nuclear power plants due to water levels in rivers

Other concerns:
• cool temperatures supporting consumption
• the geopolitical context
• maintenance on LNG facilities
• hurricane/cyclone season in LNG-producing countries

In conclusion:
Current prices remain within a range very close to pre-energy-crisis levels.
However, consumers are still waiting for a more favorable economic environment and for prices to decrease.
At this stage, long-term indicators remain favorable for the French electricity market, despite occasional phenomena generating instability and moderate increases.
In this context, we support our clients in defining floor and ceiling prices, with:
– continuous monitoring of defined thresholds
– automatic alert triggering when they are reached.