Energy crisis intensifies as gas prices surge

Energy crisis intensifies as gas prices surge

Good evening

The energy crisis sparked by Russia’s invasion of Ukraine intensified today as gas prices rocketed and the US warned of a fresh surge in oil prices unless big importers agreed to cap the amount they pay for Russian crude.

This morning’s rise in European gas prices of another 12 per cent comes on top of an increase of more than a third so far this week. They now stand at roughly 10 times the price last year before Russia began to restrict supplies.

Gascade, Germany’s gas network operator, said this morning that flows on Nord Stream 1, which connects Russia with Germany, had roughly halved to 20 per cent of capacity. Russia says the reduction was due to turbine problems, made worse by western sanctions.

The EU, which prior to the invasion of Ukraine had relied on Russia for 40 per cent of its supplies, has been struggling to get member states to agree to a voluntary cut in consumption by 15 per cent to help fill storage sites ahead of winter. Agreement has finally been reached but with a long list of opt-outs should the target become binding. Rationing and shortages this winter are a real prospect, especially if Russia tightens