Gas prices have peaked on 11 August, climbing above €200 per megawatt hour (MWh), fuelled by the growing fear of shortages and the increased energy needs during the current heatwave.
On the Dutch TTF gas futures market, commonly used as the reference in Europe, the price of gas climbed 3.8%, reaching highs of over €210 per MWh, the highest level since March, at the start of the war in Ukraine.
High prices are putting an immense strain on European countries as they attempt to fill up their gas reserves in preparation for the winter. Russia has been systematically cutting European countries from supply, demanding payment for new gas contracts in Russian rubles.
Russia has also massively throttled the supply of natural gas, in a move that the G7 says is an attempt to “weaponize” energy supplies and “exploit” its position as an energy producer to “profit from its aggression at the expense of vulnerable countries.” Volumes of gas through the Nord Stream 1 pipeline have dropped to just 20% due to “repairs.”
Russia’s aggression in Ukraine is not the only factor pushing gas prices to new heights. In Europe, water levels in the Rhine river have reached critical lows, preventing the navigation of certain vessels through its waters. This has frustrated the transportation of coal and other fuels down German waterways, further rising the price of energy.
EU Member States are scrambling to secure supply for the winter heating period. As of Aug 9, the EU has begun to save gas, aiming to reduce gas consumption across the bloc by 15% in a bid to curb demand.