Household Energy Prices Rise Noticeably in July

The short pause in household energy costs ended in July, when Austria’s energy price index climbed 5.7% from a year earlier and 1.1% from June.

The Austrian Energy Agency said energy prices were rising faster than the general inflation rate and remained a relevant driver of price increases. The components moved in different directions. Electricity prices fell 0.8% from June and 10.4% year on year. Gas prices declined 0.6% month on month but remained 4.6% above July 2025 levels.

Heating fuels recorded the strongest annual increases. Pellets cost 31.3% more than a year earlier, while heating oil rose 26.9%. Firewood prices increased 5.2%, and district heating rose 2.1%.

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Heat, drought and low water levels are currently affecting electricity generation from hydropower and nuclear power, while electricity demand for cooling is increasing.

Fuel prices also continued to pressure consumers. Diesel rose 3% from June and 19.3% year on year. Super gasoline increased 3.2% month on month and 15.1% annually. The agency said motorists should expect prices to remain high.

The agency linked pressure on European energy markets to tensions between the United States and Iran over the Strait of Hormuz, as well as climate-related disruptions. Energy expert Lukas Zwieb said heat, drought and low water levels were affecting hydropower and nuclear generation while increasing demand for cooling. That combination has increased the need for fossil-fuel generation and slowed the filling of European gas storage facilities. Zwieb said futures markets continued to anticipate higher electricity and gas prices.

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The futures markets therefore continue to expect elevated electricity and gas prices.