European gas prices up over summer

By the end of summer, the price of gas in Europe increased by 16 per cent, reaching approximately $449 per 1,000 cubic metres.

Key factors driving this rise included the situation with gas transit through Ukraine amid attacks by Ukrainian forces on the Kursk region, hot weather, and the redirection of LNG supplies to Asia, Caliber.Az reports, citing Russian media.

On May 31, gas futures were traded at around $388 per 1,000 cubic metres, but by August 30, trading closed at $449—16 per cent higher than at the end of spring. In May, the average gas price in Europe was about $357 per 1,000 cubic metres.

Since then, prices have gradually increased to $384 in June (+5 per cent year-on-year), $366 in July (+9 per cent), and $437 in August (+10 per cent). The rise in gas prices was driven by multiple factors, including hot weather, increased demand for gas-powered electricity generation, the redirection of LNG supplies to Asia, supply disruptions from Norway and the US, and modest wind power generation. Additionally, the August attack by Ukrainian forces on the Kursk region, home to the Sudzha gas metering station, further pushed up gas prices in Europe. 

Gazprom spokesman Sergey Kupriyanov has stated that the events near Sudzha in the Kursk region have led to a sharp increase in natural and liquefied gas prices, questioning who benefits from this situation.

Meanwhile, gas storage facilities in Europe are currently over 92 per cent full, slightly below the record levels of 2023, holding more than 102 billion cubic metres of gas. However, these reserves may prove insufficient for the winter in the event of unforeseen circumstances, such as a severe cold snap or a disruption in fuel supplies from Russia.