LONDON: European and UK gas prices surged on Wednesday (Oct 6) to record peaks, energised by fears of runaway demand in the upcoming northern hemisphere winter.
Europe’s reference Dutch TTF gas price hit €162.12 per megawatt hour and UK prices leapt to 407.82 pence per therm in morning deals.
However, prices later erased gains to flatline in early afternoon trade.
“It’s panic and fear with winter just around the corner,” Commerzbank analyst Carsten Fritsch told AFP.
Soaring gas prices – coupled with oil which has struck multi-year highs – have fuelled fears over spiking inflation and rocketing domestic energy bills.
Gas demand is also heightened in Asia, particularly from China, while key Russian exports are falling.
EUROPE TO BLAME: PUTIN
However, Russian President Vladimir Putin declared Wednesday that Europe was to blame for the current energy crisis, after soaring gas prices spurred accusations that Moscow is withholding supplies to pressure the West.
“They’ve made mistakes,” Putin said in a televised meeting with Russian energy officials.
He said that one of the factors influencing the prices was the termination of “long-term contracts” in favour of the spot market.
Some critics have accused Moscow of intentionally limiting gas supplies to Europe in an effort to hasten the launch of Nord Stream 2, a controversial pipeline connecting Russia with Germany.
At the same time, global gas stockpiles remain worryingly low.
“Natural gas prices have climbed to new peaks … as insufficient levels of inventories ahead of the winter season drive concerns for a spike in inflation and energy prices for consumers,” XTB analyst Walid Koudmani told AFP.
“These supply constraints could translate into higher costs of fuel moving into the winter months, a prospect which could further slow down economic recovery and worsen moods across markets.”
For all the latest business News Click Here
