Oil price surge will speed green shift, Goldman says

Oil price surge will speed green shift, Goldman says

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Russian president Vladimir Putin opened a new front in the energy war with the west, cutting off gas supplies to Poland and Bulgaria after the countries refused Moscow’s demand to shift payment into roubles.

The move sent gas futures on the continent soaring by as much as 20 per cent, before they stabilised. Ultimately the price move was more muted than previous disputes.

Poland and Bulgaria’s plight will be eased slightly by the fact that both nations have already taken significant steps to wean themselves off Russian supplies. Poland is turning to Norway and the global liquefied natural gas market, while the Bulgarians are hoping Azerbaijan can plug the gap. But even if the shift is manageable, it’s another big pull on an already creaking global gas supply system.

Russia’s decision to turn off the taps also brings the Ukraine war into a new phase. It makes clear that Putin sees gas as a weapon to be deployed in his economic fight with the west. That is likely to accelerate European efforts to move away from Russian energy in the coming years. It could also lead the Europeans to ratchet up sanctions on Russian energy, including oil, in response.

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