LONDON/OSLO (Reuters) – Gas prices soared 30% on Monday after Moscow decided to halt the Nord Stream 1 gas pipeline, which supplies Europe, indefinitely, rekindling fears of gas shortages and rationing in the European Union this winter.
Europe’s benchmark gas price climbed to 272 euros per megawatt-hour on Monday when the market opened, regaining much of the ground lost last week.
Russia announced on Friday evening that the Nord Stream 1 gas pipeline would not restart due to an oil leak detected during a maintenance operation.
Soaring energy prices are putting pressure on households and have already forced some companies, including fertilizer and aluminum makers, to shut down production to cope with rising production costs.
Brussels accuses Moscow of using gas as an economic weapon in retaliation for sanctions that target Russia after the invasion of Ukraine in February, while the Kremlin says Western countries have unleashed an economic war that is hampering the functioning of gas pipelines.
Nord Stream 1, which passes under the Baltic Sea to reach Germany, historically supplied around a third of the gas exported by Russia to Europe, but it was already operating at only 20% of its capacity before the flows were interrupted last week.
The volume of Russian gas routed through Ukraine has also been reduced.
EU energy ministers are due to meet on September 9 to discuss measures to contain soaring prices, including a cap on gas prices and emergency credit lines for companies in the sector, according to a document seen by Reuters.
(Report Susanna Twidale and Nora Buli in Oslo; French version Diana Mandiá, edited by Tangi Salaün)
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