European gas futures soar as US weighs sanctions on Russia
The price of natural gas in Europe topped $1,150 per 1,000 cubic meters on Wednesday, or €99 per megawatt-hour in household terms, trading data shows. This comes as Russia, a major energy supplier, faces threats of US sanctions.
Overall, the cost of gas in Europe jumped more than 3% on Wednesday compared to the closing price the day before. The price growth comes as the United States and its European allies are weighing a range of sanctions targeting Russia’s financial system in the event of a military conflict with Ukraine. The Biden administration has previously accused Moscow of planning an invasion of Ukraine in January, which the Kremlin has rejected as “fake news.”
Europe has been struggling with gas shortages and skyrocketing prices for months now, with the situation peaking at nearly $2,000 per 1,000 cubic meters of gas in early October.
Some European politicians have accused Russia of withholding deliveries of natural gas amid the latest delays in the EU’s certification of the Nord Stream 2 pipeline. Russia says it is meeting all its contractual obligations with European customers, pointing to under-filled European storage facilities and the start of the winter season as the main reasons for the price spike.
Russia’s Gazprom said earlier that it does not expect a noticeable drop in gas prices in Europe in the coming months, but that a price of around $1,000 per 1,000 cubic meters is not sustainable.
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