UK natural gas price rises for third consecutive day

Vladimir Putin denies using gas exports as a weapon

UK natural gas futures traded up by 6.4% on Thursday to £2.51 ($3.44) per therm, the third consecutive daily rise. 

Having briefly traded at above £4.00 per therm for the first time on record earlier in the month, the commodity fell towards the £2.00 per therm threshold at the start of the week. 

The drop was largely a result of Russia’s pledge to increase natural gas exports to Europe and President Vladimir Putin’s denial that he had stoked the energy crisis engulfing part of the continent. 

Russian denial

Speaking during a plenary session of the Russian Energy Week International Forum in Moscow on Wednesday, the Russian leader dismissed the claim that he had deliberately withheld supplies as “complete rubbish … and politically motivated tittle-tattle”.

He added: “If they [Europe] ask us to increase further, we are ready to increase further. We will increase by as much as our partners ask us. There is no refusal, none.”

Putin added: “Higher prices in Europe are a consequence of a deficit of energy and not vice versa and that’s why we should not deal in blame shifting, this is what our partners are trying to do.” 

The Russian leader instead blamed European nations’ dependence on renewable energy – in particular, wind power, which has underwhelmed this year – and the United States for reducing its own natural gas supplies and causing a panic. 

Nord Stream 2

Those accusing the Putin administration of withholding supplies have generally argued that the Russian president is attempting to put pressure on European nations in order to accelerate the certification of the Nord Stream 2 pipeline.

The pipeline, whose completion was severely delayed by a slew of sanctions from the United States, will provide natural gas directly from Russia to Germany via the Baltic Sea, to the fury of several Eastern European nations. 

Although the Russian president said that he would increase gas transit to Ukraine this winter, he added that the economic appeal of exporting gas via Ukraine beyond 2024 was complicated by Europe’s plans to reduce the use of hydrocarbons.

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