European gas prices soared more than 30% on Tuesday as low supplies from Russia reignited concerns about an energy crunch as the region heads for colder weather, according to Reuters.
Traders stated that a key pipeline that normally delivers gas from Siberia to Europe continued to work in reverse on Tuesday, sending flows from Germany to Poland, while supplies of Russian gas from Ukraine to Slovakia were also subdued.
Russian energy exports have been in the spotlight amid the country’s broader standoff with the West, including over its tensions with neighbouring Ukraine, which is forging closer ties with NATO.
Gas flows via the Yamal-Europe pipeline, which usually sends Russian gas west into Europe, jumped on Tuesday in the eastwards direction, data from German network operator Gascade showed, with gas flowing from Germany to Poland for a 15th straight day.
„Expectations for colder weather in Europe were contributing to upward pressure on prices, but the low Russian gas flows were the key driver,” a trader said.
Europe has been at the centre of an energy crisis since last year, when the lifting of COVID-19 restrictions put huge demands on depleted stocks of natural gas. Benchmark prices have more than quintupled since January 2021, squeezing consumers and companies and threatening the economic recovery.
Some European Union lawmakers have accused Russia, which supplies more than 40% of the bloc’s natural gas, of using the crisis as leverage. They say Moscow has restricted gas flows to secure approval to start up the newly built Nord Stream 2 pipeline, which will supply gas to Germany.
Russia has denied the allegations and says the pipeline will boost gas exports and help alleviate high prices in Europe. It has said it is meeting its contractual obligations on gas deliveries.
Russian energy giant Gazprom said on Sunday it had increased its overall gas exports, including to China, last year. However, it was likely to miss its target for supplies to Europe.