Russia’s Gazprom warns that European gas prices could rise another 60%

Gazprom, a Russian state gas company, stated Tuesday that European gas prices could rise by 60% to over $4,000 per 1,000 cubic meters this winter as European exports and production continue to decline due to Western sanctions.

After Russia’s top supplier of gas to Europe, the flow of this gas has dropped in recent years. In February, Russia sent troops into Ukraine and sanctions triggered a dispute over Nord Stream 1’s equipment. As a result, gas prices have risen.

“European spot gasoline prices have reached $2,500 per 1,000 cubic metres,” Gazprom stated that prices could rise to $4,000 per 1,000 cubic meters if this trend continues.

In spring, wholesale gas prices in the Netherlands reached an all-time high at 335 euros per megawatt-hour (MWh). Although they have fallen to 226.00 euros per megawatt-hour (MWh) on Tuesday, they remain much higher than last year when they were 46 euros per MWh.

Gazprom shut down one of its routes to Europe from Kyiv, and Gazprom reduced supplies to 20% of Nord Stream 1’s capacity to Germany in the midst of an equipment dispute.

Gazprom reported that its gas exports decreased by 36.2% to 78.5 Billion cubic metres between Jan. 1, and Aug. 15, and that production fell by 13.2%, to 274.8 Billion cubic metres, compared to one year ago.

Gazprom’s August output fell by 32.2% compared to a decrease of 35.8% in July, Evgeniy Suvorov, an economist at CentroCreditBank stated on the Telegram channel MMI. He also said that the export had fallen by 59% compared to minus 58.4% last year.

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