EDF loses 400 million euros because of a trader’s (lost) bet – The HuffPost

BENOIT TESSIER via REUTERS

ENERGY – In the midst of the global energy crisis and while governments are criticized for their responses to purchasing power issues, the news has something to laugh about. EDF Trading, a subsidiary of the electricity giant, lost 400 million euros in early October while speculating in the energy markets, according to information published Friday evening October 29 by Le Figaro.

“The company does not comment,” a spokesperson for EDF told AFP. Also contacted, the Ministry of the Economy declined to comment, referring to EDF, 80% owned by the State.

The manager will be fired

This colossal loss would have already been offset by gains in the market, according to the daily. If a loss had “impacted EDF’s results, it would have been made public,” a source familiar with the matter told AFP. For any listed company, as is the case with EDF, a loss liable to modify the announcements made to the markets must be disclosed. EDF publishes its third quarter results on November 10.

According to Le Figaro, this loss would be due to the bet of a trader who “speculated on a future decline of electricity known as ‘de pointe hivernale France’ (produced and delivered between 8 am and 8 pm, Monday to Friday) ”.

At the beginning of September, prices only increased. However “during a downward bet, the security deposits claimed from the trader increase with each upward fluctuation”, explains Le Figaro. The trader “had to abandon his bet at the worst moment: in the first days of October, when the market (…) reached record levels, around 200 euros per megawatt hour ”against a maximum of 50 euros at the same time a year earlier.

The French trader at the origin of the loss “saw his access to market software suspended, and a dismissal procedure would be initiated against him”, according to the newspaper, which specifies that an internal investigation was opened. On the Paris Bourse on Friday, the title EDF ended down 2.38% to 12.73 euros.

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