European gas prices continue to soar
Natural gas prices in Europe have continued to rise, jumping 12% on Thursday, after the EU Commission acknowledged that it would be impossible to implement a proposed plan to cap Russian gas prices.
October gas futures at the TTF hub in the Netherlands at one point exceeded $2,500 per thousand cubic meters, before later retreating to $2,450.
Prices have seen upward pressure due to the uncertainty over supplies from Russia as the Nord Stream 1 gas pipeline has been shut down for an indefinite period over technical issues due to sanctions. Also, on Wednesday, the EU dropped its plan to impose a ceiling on the price of gas imports from Russia after pushback from several of the 27 member states.
The bloc has been introducing measures aimed at reining in an unprecedented energy crisis that has fueled inflation, hurt industry and left numerous nations on the brink of a recession. Analysts are raising concerns that the measures being adopted won’t help reduce gas demand during the winter season.
“Months of geopolitical wrangling have left the European gas market whiplashed,” Zongqiang Luo, a senior analyst at Rystad Energy, told Bloomberg. “The gas market is broken … but how it should be supported or fixed is an ongoing conversation with no clear resolution in sight,” he stressed.
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