Gas prices rose again due to growing tensions about Russian troops at Ukraine’s border and greater uncertainty regarding Nord Stream 2 pipeline.
The European natural gas price rose to EUR115 per megawatt-hour on Monday morning. Prices in the UK increased 12% above 300p per therm while benchmark US prices rose 3.77 per cent in that same window.
Germany suspended approval of Nord Stream 2 gas pipeline sending gas prices soaring.
After supply shortages and problems with the pumps, prices rose to new records in October. A fresh rally could be possible as the diplomatic crisis between Russia, the US and Europe continue.
The US Secretary of State Anthony Blinken demanded that Nord Stream 2 be stopped if Russia invades Ukraine. In the meantime, the Kremlin has placed over 120,000 troops close to its eastern border in the past month.
Although the 759-mile £8.4bn pipeline has been completed, initial supplies were loaded into the tubes in October. However, it still needs to be certified by German regulators.
Due to governance concerns, the process was delayed last month. Gazprom-backed Nord Stream AG is now creating a company to manage the German section of the pipeline.
Germany is under pressure to stop approval of Nord Stream 2 from Russia if President Putin invades Ukraine. US President Joe Biden threatens the Kremlin by imposing severe economic sanctions if this happens.
While Mr Putin had been pushing for approval of the pipeline, Germany’s foreign minister stated that it does not meet EU standards.
The decision will not be made until next year and must then be approved by European Commission.
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