Home » The week of records for the gas race: + 25%. The unknown of autumn

The week of records for the gas race: + 25%. The unknown of autumn

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The week of records for the gas race: + 25%.  The unknown of autumn

In a week of intense tensions due to the war in Ukraine, the price of European natural gas rose to record highs, with the TTF index in Amsterdam climbing 25% in five days. Gas prices in Europe are already very high and have continued to rise this week as energy demand remains high due to the great heatwave; on the other hand, supplies of other fuels for energy production are limited by the low water levels of the Rhine River, the main European corridor for the transport of oil and coal.

It should be remembered that on Friday, after Gazprom’s announcement of the new “technical” stop of the Nord Stream gas pipeline for three days, prices jumped by more than 9%, with the price of gas exceeding 262 euros per megawatt hour , to then close the day at 257.4 euros / MWh. Gazprom will shut off all gas flows to Europe via the Nord Stream pipeline from August 31 to September 2, the Russian gas giant announced Friday.

GAS PRICES IN EUROPE

Future Dutch TTF, trend last week. In euro / MWh

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The reason for the suspension would be the consequence of maintenance work in the Trent 60 gas compressor station, carried out with Siemens. Maintenance was not planned and tensions between Russia and the EU (and Germany) are increasing, already in the midst of an energy crisis, further limiting supplies. Nord Stream flows were reduced by 40% from mid-June and another 20% at the end of July after scheduled maintenance stalled on a gas turbine repaired by Siemens itself but never put back into operation. The big German says that the work on the turbine had been completed for weeks and that he had waited for Gazprom to provide the customs documents necessary for its return. Gazprom in turn said that it was Siemens that did not provide it with the necessary documents to allow the turbine to be returned despite the sanctions. A controversy that would be comical were it not that it is aggravating an energy crisis for European companies and consumers and that seems more like a pretext for Russia to respond to European sanctions.

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This week Gazprom announced that its natural gas sales plummeted 36.2% to 78.5 billion cubic meters from January to mid-August, due to a drop in deliveries in Europe. The EU, for its part, has reduced its dependence on Russian gas supplies by 50%, but has made it known that rationing will be needed in the autumn to compensate for the missing supply. This is what EU High Representative for Foreign Affairs Josep Borrell said earlier this month on his blog.

Meanwhile, Gazprom has warned that gas prices in Europe could rise by 60% this winter. The president of Arera, the Italian Energy Authority, Stefano Besseghini, intervened on the question: «These summer fluctuations in the cost of gas are part of a fairly clear strategy of Russia to keep the price in tension. Should Moscow completely block the flow of gas, there will be emergency interventions to reduce demand. Which will pass first through the industrial sectors and which will only hit consumers in the last resort ».

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