European wholesale gas prices rise as Russia halts supplies again

European gas prices rose, stocks slid and the euro fell on Monday after Russia halted pumping of gas down a key supply route, sending another economic shockwave through the European Union as it struggles to recover from the pandemic recover.

United States governments are pushing through billions of euros in packages to prevent utilities from being crushed by a liquidity crisis and to protect households from soaring energy bills after Russia’s state-controlled Gazprom announced it would stop pumping gas across the Nord Stream 1 pipeline to shut down due to failure.

Europe has accused Russia of arming energy supplies in retaliation for Western sanctions against Moscow over its invasion of Ukraine. Russia blamed sanctions from the “collective West” for the gas supply problems.

Plenty of European power distributors have already collapsed and some big generators could be at risk, hit by caps that limit the price increases they can pass on to consumers or caught off guard by hedging bets, with gas prices now 400 per cent higher than before a year.

“It has the ingredients for a kind of Lehman Brothers of the energy industry,” Finnish Economy Minister Mika Lintila said on Sunday, referring to the bank that collapsed in 2008 and heralded the global crash.

Finland intends to offer its energy companies €10 billion and Sweden SEK 250 billion (€23 billion) in liquidity guarantees.

Russia said yesterday that supplies would not resume until sanctions ended. European wholesale gas prices rise as Russia halts supplies again

Fry Electronics Team

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