European power prices now ~300% above US levels, benefitting US metals makers

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• Electricity throughout Western Europe traded ~€360/MWh Friday, as sky high thermal coal and natural gas prices raised feedstock costs for utilities across the continent.
• In the US, where natural gas continues to trade near historically low levels, and coal price volatility has been blunted by long-term contracts below spot market prices, electricity traded ~€113/MWh Friday.
• Consumers in both jurisdictions are largely insulated from short-term volatility in power prices; however, Europe's energy intensive industries are seeing costs rise in real time, lifting global prices for energy-intensive commodities like aluminum and steel.
• US metals producers benefitting from relatively cheap power feedstocks, like Alcoa (NYSE:AA), Century (NASDAQ:CENX), and Nucor (NYSE:NUE), should see higher earnings as Europe struggles to manage the war in Ukraine and resulting energy crisis.