Prices jump as Russia stops supplying gas to Austria
Gas prices experienced significant volatility on Friday following news of Russian supply cuts.
Large intraday swings were observed during afternoon trading, ultimately resulting in minor moves posted in both directions when compared to the previous close. At around 15:00 UK time, it was confirmed that Russia’s Gazprom would halt pipeline flows into Austria effective Saturday morning.
This decision came after Austrian operator OMV asserted just days earlier that it would not pay an invoice due around 20th November. The market’s reaction was swift, within minutes the Summer 25 front-season contract surged to 110p/therm (3.75p/kWh) for the first time since October 2023.
In other news, the US, along with allies France and the United Kingdom, has authorized Ukraine to use long-range missile systems to target deep within Russia. The Kremlin has described this decision as an “escalation that could end with Ukrainian statehood in complete ruins” and a “very big step towards the start of World War 3.”
Further developments in Ukraine will be closely monitored by the wider energy markets in the coming days.
As of this morning, NBP gas prices remain relatively unchanged, with both the front-month and front-season contracts currently being offered in line with their previous settlements, at time of writing.
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Price commentary courtesy of Crown Gas and Power 