High temperatures in Japan drive up demand for cooling, causing spot electricity and LNG prices to rise simultaneously

(1) Japan's ongoing heatwave has increased electricity demand for cooling, pushing the national spot electricity price up 9% from the previous week to 21.57 yen per kilowatt-hour (about 13 US cents), the highest level since early June. (2) Meanwhile, renewed conflict in the Middle East has disrupted liquefied natural gas (LNG) supplies, raising import costs and driving power prices even higher, now at their highest since March. (3) The Japan Meteorological Agency expects Tokyo's temperatures to reach 37°C midweek, with some areas in the Tokai region possibly rising to 40°C on Tuesday—a rare heat event in local recorded history.