Natural gas in Europe rose to the highest level in almost four months as planned strikes in Norway threaten to further tighten a market that’s already reeling from Russia’s supply cuts, APA reports citing Bloomberg.
Benchmark futures, which have more than doubled this year, surged as much as 10% on Monday. About 13% of Norway’s daily gas exports are at risk amid plans to escalate an impending strike by managers, the nation’s oil and gas lobby warned over the weekend. Three fields are set to be shut by the strike starting Tuesday, while planned action the following day would take out another three projects.
Norwegian supply is becoming increasingly important for the continent after shipments from the biggest provider Russia slumped amid the invasion of Ukraine and subsequent sanctions on Moscow. That coincided with a prolonged outage at a key export facility in the US, another major source of gas for Europe. The impact is spreading through the continent’s economy, hurting industries that cannot pass on increased costs of fuel to end-users.
“Supply concerns are extremely high and the market continues to add risk premium,” analysts at trading firm Energi Danmark said in a note. “The situation will remain tense this week and we expect further increases if flows remain low.”
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Dutch front-month gas futures, the European benchmark, hit the highest intraday level since March 9 and were 8.3% higher at 160 euros per megawatt-hour at 1:10 p.m. in Amsterdam. The UK equivalent surged as much as 16%.