Germany burned less gas for power and paid more for it

Brent crude futures rose $3.19, or 2.9%, to $112.01 a barrel by 13:11 GMT on Thursday, after touching $112.68, the highest since 18 May, Reuters reported¹. The triggers were the ones you have read about all week: more Houthi strikes in Saudi Arabia, and Iran’s Revolutionary Guard saying four vessels in the northern Gulf were hit and set on fire and three more struck mines west of the Strait of Hormuz^1,2. On Thursday, six people told Reuters, Saudi Aramco told staff to leave its Dhahran headquarters and work from home¹.

Here is the part the headline leaves out. The barrels are moving. Kpler data show oil exports from the Persian Gulf above their pre-war levels, the Guardian reported, partly because more crude now travels overland by pipeline to the Red Sea and the Gulf of Oman². Morgan Stanley put Middle East crude exports at about 17 million barrels a day last week¹. “Reports of Middle East crude oil exports exceeding pre-conflict levels are more than countered by attacks on ships in the Strait of Hormuz and the Houthi strikes on Saudi Arabia,” said Tamas Varga of PVM Oil¹.

So Thursday’s price is not a count of missing oil. It is the price of the chance that oil goes missing: insurance, rerouting, a mine field, an office tower emptied as a precaution. Nobody can invoice a probability, but everyone pays for one.

How the fear reaches you. For a household in Germany the barrel is mostly a petrol-pump and heating-oil story. The bigger bill runs through gas, and through power stations that burn it. Dutch TTF gas, Europe’s benchmark, settled at €87.43 per megawatt hour on Wednesday, up 2.78% on the day, after a rally of about 19% in October³. EU gas storage is 74.58% full, 16.0 points below the five-year average of 90.6% for the date, and has started to draw down³. Germany’s stores are 61.1% full³. The cold has arrived where the stores are thinnest: Munich 3.6°C, Berlin 5.6°C in GasRadar’s morning readings³.

The print. Now the part that sounds backwards. Germany has burned less gas for electricity this October, not more. Gas plants generated about 3,421 gigawatt hours over 1 to 21 October 2026, against about 4,054 GWh over the same days of 2025, according to the Bundesnetzagentur’s SMARD data⁴. Desk arithmetic: about 16% less. Solar panels made up much of the difference; their output over the same days is up by about two-fifths⁴. Lignite is up too⁴.

And yet the day-ahead auction for the Germany-Luxembourg zone averaged €169.93 per megawatt hour over 1 to 21 October, against €94.14 a year earlier⁴. Desk arithmetic: about 80% higher, on a sixth less gas.

The reason is the dullest rule in the market. In most hours the price is set by the last plant needed to meet demand, and in Germany that is still often a gas plant. Fewer gas hours lower your exposure; they do not lower the price of the hours that remain. When the molecule costs more, so does the marginal hour, however few of those hours there are.

You can watch the rule work day by day. Wednesday 21 October was the biggest gas-burning day since 25 February, at about 241 GWh, and it was also the dearest delivery day of the week, at €211.94⁴. Thursday cleared at €148.61, and Friday, auctioned at midday on Thursday, at €137.59⁴. Gas burn for those days is not yet published.

What this argues for. Not panic, and not a speech. The two lines on these charts point at the same unglamorous fixes. Every gas hour replaced by a solar or wind hour is an hour the Gulf cannot price. Every interconnector lets a windy hour in the north cover a cold hour in the south. And every percentage point in a storage cavern is a cold February that does not have to be bought on the spot market. None of this makes the news like a tanker on fire. All of it decides the invoice.

The oil market will keep reacting to words and drones. PVM’s Varga expects no de-escalation before the US midterm elections¹; that is a view, not a fact, and the desk records it as such. What is a fact is the arithmetic of the last three weeks: less gas burned, more paid for each megawatt hour. A country cannot control the Strait of Hormuz. It can control how many of its hours depend on it. Nothing here is advice.