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223 euros per megawatt hour: European natural gas prices three times higher than before the Ukraine war

2022-09-01T13:46:18.358Z


The situation on the gas market seems to be easing at a high level - also because of well-stocked storage facilities. Meanwhile, Spain is lowering the gas tax to the European minimum in order to relieve the burden on the population.


Enlarge image

Cock on a gas pipeline in Kyiv (symbol image)

Photo: Sergey Dolzhenko / dpa

The situation on the European gas market seems to be easing further: On Thursday morning, the price of the TTF futures contract for Dutch natural gas fell by almost seven percent to EUR 223 per megawatt hour.

The contract is seen as a benchmark for gas prices in Europe.

At the end of last week, its price was more than 100 euros higher.

However, European natural gas still costs about three times as much as it did before the Ukraine war.

On the one hand, the surprisingly fast filling of the natural gas storage facilities in Europe is likely to be a decisive factor in the recent relaxation.

This at least somewhat reduces the risk of significant supply bottlenecks in the winter months.

In addition, efforts are being made on the European side to reduce the risk of bottlenecks by taking measures to curb demand.

The range is also to be expanded to include additional sources of supply.

In the middle of the week, Russia had also stopped gas supplies via the Nord Stream 1 pipeline in the Baltic Sea, as announced.

Gazprom cites technical reasons for the delivery break, which is expected to last until September 2nd.

However, experts question whether this is really the case.

In order to relieve citizens in Germany, the top of the Union faction wants to use the separation of the gas price from the formation of the electricity price.

The price dynamics must be broken, "which is currently only triggered by the gas-fired power plants and which also triggers these high electricity prices for everyone else," said Union parliamentary group leader Friedrich Merz (CDU) to start a retreat for the executive board of the CDU/CSU deputies the Zugspitze.

Meanwhile, the government in Spain is lowering the VAT on gas to the prescribed European minimum in the fight against high inflation.

Prime Minister Pedro Sánchez announced that from October only five percent would be due instead of 21 percent.

The measure is therefore limited until the end of the year.

It seems "reasonable" to try to "lower the heating bill" with the autumn and winter months approaching, Sánchez said on Spanish radio.

He is ready to extend this measure again in the coming year, “as long as this difficult situation lasts”.

Meanwhile, gas and electricity will be more expensive for people in Turkey from September.

Electricity prices for private households will increase by 20 percent and for industry by 50 percent, according to the Turkish energy market regulator.

Gas price hikes are roughly in the same range, according to a statement from state-owned gas trading company Botas.

ani/AFP/dpa

Source: spiegel

All business articles on 2022-09-01

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