Gas prices in the European Union have risen to the highest level
15 November 2024 10:09
The Austrian energy company OMV is in a conflict with the Russian gas giant Gazprom, which has led to a significant increase in gas prices in Europe. This was reported by Spiegel, "Komersant Ukrainian" informs.
The tension arose due to OMV’s demand that Gazprom compensate 400 million euros for the suspension of gas supplies to Germany in September 2022. OMV plans to deduct this amount from monthly payments.
The conflict is becoming more acute, as Gazprom may cancel the contract with OMV next week due to outstanding financial obligations. This poses a threat to the stability of gas supply in Europe, as the contract provides for about half of the volume of Russian gas currently supplied through Ukraine.
As a result, European gas prices rose by 5%, reaching their highest level since November last year. At the same time, the current price of 46 euros per megawatt-hour remains several times lower than the record highs recorded in August 2022, when it reached 345 euros.
Despite the fact that European storage facilities are more than 90% full, gas market analysts say that this situation continues to create tension in energy markets. According to Rystad Energy, imports of liquefied natural gas to Europe increased by 10% in October. The EU is taking such measures to reduce the risks of a winter shortage.
Follow us on Telegram: the main news in brief
Europe and gas
As of the beginning of 2022, the EU was 40% dependent on Russian gas. In 2021, 65% of the gas purchased by Germany was Russian. In the third quarter of 2023, only 12% of the gas imported by the EU was Russian.
The current contract for gas supplies to Europe through the Ukrainian gas transportation system expires in December 2024. Both sides have made it clear that they are not going to extend it.
At the same time, some EU countries remain dependent on Russian gas, such as Hungary, Slovakia, and Austria. These countries’ contracts with Gazprom provide for gas supplies through the Ukrainian gas transportation system. For example, Austria signed a contract for gas supplies until 2040.
After both Nord Stream and the Ukrainian GTS are shut down, Russia will be able to supply gas to Europe only through the Turkish Stream.
According to the Center for Research on Energy and Clean Air (CREA), since the beginning of the full-scale Russian invasion, the European Union has purchased 205.9 billion euros worth of energy from Russia.
Follow us on Telegram: the main news in brief
