Given that pre-winter November weather in Europe has been relatively cold, the combination of the latest and complete Biden Administration sanctions on Russian gas, and the imminent shutoff of gas through the Urengoy-Pomary-Uzhhorod pipeline on Dec. 31, are further escalating the price of gas in Europe. The Dutch TTF natural gas price, $15.00/million btu, is nearly five times the benchmark U.S. price, $3.25/million btu, and is also far above natural gas prices in Asia, according to a Dec. 6 article in OilPrice.com. Electricity spot prices in Europe are at a two-year high.
The jump took place after Nov. 20, when the U.S. Treasury sanctioned Gazprombank and attempted to make payment for Russian natural gas impossible; the attack also sent the Russian ruble plunging to 115/dollar. A new payment arrangement made public by Russian President Vladimir Putin Nov. 28 kept payments open, and the ruble was back up over 100/dollar by Dec. 7; but gas prices remained at the high in Europe, with the shutdown through Ukraine looming.
