The price of gas for the winter in Europe fell by more than a quarter

Photo by Naglio Navako (VŽ)

Russian President Vladimir Putin has ordered Gazprom from November 8. gas futures in Europe, gas futures prices fell by 27%. Increased gas supply from Norway, as well as falling coal prices in China, also contributed to the fall.

Gas prices for December on October 29. At the end of trading on the ICE exchange, it dropped to 66.1 Eur / MWh. This is 27.1% less than in the middle of this week, until some news appears to improve the gas supply outlook. The most notable was the order of Russian President Vladimir Putin to instruct the country’s gas export monopoly Gazprom to start filling the company’s gas storage facilities in Europe.

On Wednesday evening, it was announced that the Russian president had ordered to start filling the half-empty gas storage facilities operated by the company in Germany and Austria from November 8, when the Russian gas storage facilities will be filled. Such a decision “will create a more favorable position in the European energy market”, Putin said in a conversation broadcast on state television.

Read more about the causes and prospects of the gas price crisis in Europe here: The prospect of a harsh gas winter sees a glimmer of hope.

Higher gas flows from Norway and China The fall in coal prices is also having a negative effect on natural gas prices, according to Engie EnergyScan analysts, according to Bloomberg. On Wednesday, Norway’s Equinor promised to increase exports. The country’s gas system operator Gassco also announced that the maintenance of the country’s Troll gas field infrastructure, scheduled for December, will be shorter.

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The infrastructure has not yet been booked

Some analysts link Putin’s comments to a previous assessment of Nord Stream 2 by the German Ministry of Economy to the country’s regulator, which states that the new pipeline does not pose a risk to security of supply.

Earlier in October, news that Gazprom had not reserved additional pipeline capacity through Ukraine or Poland in November caused a sharp jump in prices above the 100 Eur / MWh threshold. It is not yet clear what infrastructure the Russian gas monopoly will use for the gas it will use to fill its half-empty gas storage facilities in Europe.

“We still do not know how much extra gas could be supplied from November 8, following President Putin’s instructions. So some risk should remain until the gas supply profiles change, ”Bloomberg quotes Tom Marzec-Manser, an ICIS analyst.

According to Bloomberg sources, Moscow is worried that gas prices, which have remained at a record high for a long time, will start to dampen demand, as gas consumers switch to possible alternatives. Therefore, the Kremlin would like to reduce gas prices by about 60%.

Even so, gas would cost almost twice as much this winter as the average at the same time over the past decade.

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