European gas price drops due to Russian withdrawal messages

Photo: ANP

European gas prices fell Tuesday, mainly on reports that some Russian troops near the border with Ukraine have returned to their army bases after exercises. Forecasts for mild winter weather on the European mainland are also helping to keep energy prices down.

The price of a megawatt hour of gas on the Dutch futures market, which leads European gas prices, fell by almost 10 percent around noon to 73 euros. In December, that price peaked at almost 188 euros due to major concerns about gas shortages. Russian gas deliveries via a pipeline through Ukraine to Slovakia are increasing again. Gas deliveries via a pipeline through Poland are still at a standstill.

Furthermore, stronger winds in Europe help the production of more power by wind turbines, which depresses electricity prices. For example, a very high production from wind turbines is forecast for Germany on Wednesday.

Oil prices also fell sharply on the hope of a diplomatic solution to the conflict over Ukraine. On Monday, US oil prices soared above $95 a barrel for the first time since 2014, amid concerns over an escalation in the conflict and fears of a Russian invasion. German Chancellor Olaf Scholz is currently in Moscow to meet with President Vladimir Putin.

The European Central Bank (ECB) wrote in a study that the economic activity of the eurozone could be shocked if gas prices were to rise very fast and even have to be rationed. Countries such as Austria and Slovakia would be particularly sensitive to this, as would the steel sector, according to the ECB.

European gas price drops due to Russian withdrawal messages
Source link European gas price drops due to Russian withdrawal messages

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