European gas prices hit record high as Russia supply fears grow | Russia-Ukraine war News


Regardless of Russia’s invasion of Ukraine, fuel deliveries from Russia to Europe by its varied pipelines have thus far remained largely unchanged.

European and British fuel costs soared on Wednesday, with a benchmark Dutch fuel value hitting a file excessive as international locations mentioned European Union sanctions towards Russia might goal fuel shipments, whereas some cargos of Russian liquefied fuel modified course.

The UK on Monday ordered that Russian-associated vessels be blocked from its ports, whereas officers from some EU international locations have mentioned the 27-country bloc is contemplating a ban on Russian ships.

The European Parliament on Tuesday referred to as for the EU to shut its ports to Russian ships or ships going to or from Russia.

Though the Parliament doesn’t set sanctions and its vote on Tuesday was nonbinding, merchants mentioned it confirmed the course of journey for potential tightening of measures towards Russia, which provides round 40 % of the EU bloc’s pure fuel.

Not all international locations get provide immediately from Russia, but when international locations reminiscent of Germany, the most important client of Russian fuel, obtain much less from Russia, they have to change this from elsewhere, as an illustration, Norway, which has a knock-on impact on accessible fuel for different international locations.

The benchmark Dutch front-month fuel contract on the TTF hub hit a file intraday excessive of $205 (185 euros) a tonne on Wednesday – simply beating the earlier excessive of $204 (184.95 euros), seen final December when Russian flows by the most important Yamal pipeline started sending fuel eastwards in reverse.

The UK front-month contract hit 384 pence a therm, its second-highest ever degree amid reviews Russian cargos of liquefied pure fuel have been being diverted away from UK ports.

“The value transfer at present shouldn’t be based mostly on elementary modifications to the European fuel balances,” mentioned Leon Izbicki, European pure fuel analyst at Vitality Elements.

“The principle driver behind the sharp rise within the TTF is a perceived enhance within the danger of European sanctions concentrating on Russian vitality exports,” he mentioned.

Regardless of the continued warfare in Ukraine, bodily deliveries of fuel from Russia to Europe by its varied pipelines have thus far remained largely unchanged.

Even fuel deliveries coming from Russia by way of pipelines by Ukraine have remained strong. Capability nominations for provide to Slovakia from Ukraine by way of the Velke Kapusany border level have been anticipated to hit their highest degree thus far in 2022, at 881,917 megawatt hours on Wednesday.

However merchants and analysts mentioned that because the warfare and sanctions escalate, so do the probabilities that this might change, which is inflicting the massive value beneficial properties.

“With the potential provide disruption from Russia reverberating all through the European vitality market, risky vitality costs are more likely to proceed for the foreseeable future,” mentioned Craig Lowrey, senior marketing consultant at Cornwall Perception.

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