New rise for European gas – At 126 euros per megawatt hour

European gas prices are still rising today, as supply cuts from Moscow hit the region, with governments turning to alternative energy sources and urging consumers to cut consumption, according to Bloomberg.

Germany, Austria and the Netherlands are reversing their policies and turning to more “dirty” coal to ensure energy efficiency. Large German industries are ready to cut consumption to allow gas to be stored so that there are enough reserves for heating in the winter, a minister said.

Deep Russian cuts threaten the European economy at a time of already high inflation and weak growth. Uniper SE, Germany’s largest buyer of Russian gas, said it could find it difficult to supply its own customers if the situation continued. Meanwhile, the impact is spreading, with Denmark issuing an “early warning” of shortages.

“We are fulfilling the contracts we are signing with our customers now, but I do not know to what extent we can continue to do so,” Klaus-Dieter Maubach, CEO of Uniper, said in an interview. “For us, this is a historic moment. We have never seen such a major disruption in the flow of gas from Russia.”

Gazprom’s shipments via Nord Stream – the largest pipeline to the European Union – remain at about 40% of capacity. Moscow says the sanctions have caused problems with turbine repairs. Meanwhile, the pipeline will be closed for maintenance for 10 days next month.

European gas reserves are about 55% full, with storage space being filled normally so far. But the supply disruption means that reaching the target of 80% full stocks by November 1 “will be a cause for concern,” ING Groep said.

In this climate, the Dutch futures contract – a European benchmark – rose 4.6% to 126.20 euros per megawatt hour. Yesterday it rose 2.5%. The corresponding British contract is strengthened by 6.1% at 213 pence per thermal unit.