European gas prices surge amid concerns over Russian supply

WORLD  23 May 2024 - 16:15

European natural gas prices reached their highest point since January, with TTF prices closing 4.2% higher at nearly €34.39 per megawatt-hour.

According to investing.com, this increase follows an announcement by OMV, an Austrian energy company, indicating a potential disruption in Russian gas flows to Austria due to a court ruling that could impede payments to Gazprom Export for delivered natural gas. The implementation of the court decision remains uncertain.

The supply in jeopardy consists of 6 billion cubic meters annually, which Gazprom provides to OMV under a long-term contract for delivery into Austria.

Austria is heavily reliant on Russian gas, with 93% of its gas imports in March originating from Russia. A halt in these supplies could lead to localized market tightening, though it is expected that Europe overall would be able to cope with the situation.

Investment funds have adjusted their positions in response to the market dynamics. As of May 17, they reduced their net long positions in TTF by 11.66 million contracts to 91.55 million contracts. This marks the first decrease since early April and reflects the market's reaction to various factors influencing the energy sector.

Caliber.Az