Russian state giant Gazprom decided yesterday (31) to cut off gas supplies to Europe via Ukraine, the sector's national regulator confirmed, making an increase in current prices almost certain.
According to the French news agency, France-Presse (AFP), the GTSOU has posted on its website a forecast of zero cubic meters (m3) of distribution volume as of Wednesday, January 1, thus confirming that it will cut off supplies to Europe via a route that included Ukraine.
This decision marks the end of a 2019 contract between Gazprom, the Russian state-owned gas giant, and several European countries, including Slovakia, Moldova and Hungary, through a pipeline network on Ukrainian soil, which continued to operate despite Russia's invasion of Ukraine in February 2022.
A few days ago, AFP reported that the price of gas in Europe had hit the 50 euros per megawatt-hour mark for the first time in over a year, driven by the end of this agreement, but also by the cold winter.
After initially reaching this symbolic threshold and then retreating, the Dutch TTF futures contract, considered to be the European benchmark for natural gas, finally surpassed it a little later in the session.
Since the invasion of Ukraine in February 2022, the EU has reduced its exposure to Russian gas, but according to Christoph Halser, an analyst at Rystad Energy, this resource will still account for 14% of its total consumption in 2024, compared to 12% last year.
In this context, "a colder than expected winter or further delays in liquid natural gas projects" could lead, in the short term, to prices of around 60 euros per megawatt-hour, according to Daniela Sabin Hathorn, an analyst at Capital.com, quoted by AFP.
According to the Oxford Institute for Energy Studies, the consequences of this interruption will include an accelerated decline in European reserves and upward pressure on gas prices.
The low temperatures recorded since the end of October have already encouraged the use of heating and the lack of sun and wind has led to a greater proportion of electricity being produced from natural gas.
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