EU Gas Prices Soaring Once Again as Countries Agree to Cut Consumption by 15%
Natural gas prices in the EU are climbing sharply once again, after Russia slashed shipments to only 20% capacity via the Nord Stream 1.
With Gazprom slated to send one more turbine into maintenance and reduce gas capacity to 20% come Wednesday, EU nations are becoming increasingly worried about the future of their energy supply. As such, member countries reached an agreement in Brussels on Tuesday to voluntarily cut back their gas usage by 15% over the next eight months, in an effort to avert a full-blown energy crisis.
“We can be masters of our own energy security this winter,” said EU climate chief Frans Timmermans, as cited by Bloomberg. “We will stay the course until Ukraine is completely free of Russian aggression.” But, despite the EU’s perseverance, the region is slated for a very cold winter and a GDP decline of up to 1.5% should it fail to refill gas storage facilities to at least 80%.
Making matters simultaneously worse though, is the increase in natural gas prices. The price of natural gas in Europe has risen to the highest since March following Russia’s supply reduction, with August futures on the TTF hub momentarily surpassing $239 per megawatt hour on Wednesday morning. Since the beginning of the year, natural gas prices in Europe have quadrupled from the $60 per megawatt hour noted on January 1.
Information for this briefing was found via Bloomberg and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
