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5 Jul, 2022 14:00

Energy crunch pushing European gas prices higher

A strike in Norway is adding to the Russian supply crisis
Energy crunch pushing European gas prices higher

Natural gas prices in Europe rose to the highest level in almost four months on Tuesday as the continent’s energy crisis intensifies.

Benchmark futures tied to TTF, the European wholesale gas price, jumped 8% to over $1,800 per thousand cubic meters or €175 per megawatt hour in household terms. That is the highest level since the beginning of March and five times more than it was this time last year. 

The prices jumped as oil and gas workers in Norway, Europe’s second-biggest supplier after Russia, went on strike over pay. According to Reuters, the industrial action could cut the country’s gas exports by almost 60% over the course of this week.

This comes as uncertainty grows over the gas flow to Europe from Russia. Last month, Gazprom slashed its supplies via the Nord Stream pipeline to Germany, citing technical issues stemming from Ukraine-related sanctions. The pipeline is also due to close for its annual 10-day maintenance next week, with many in the EU fearing that the gas flow will not be turned back on.

On March 7, two weeks after the start of Russia’s military operation in Ukraine, gas prices in Europe reached a historic maximum of $3,900 per thousand cubic meters.

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