European natural gas prices surged as investors anticipate another Russian shutdown of a key energy pipeline later this month as the region grapples with collecting supplies for the winter season.
Russia’s state-run energy company Gazprom on Friday surprisingly said it would close the Nord Stream 1 pipeline for maintenance between August 31 and September 2.
A Trent 60 gas compressor unit “must undergo technical maintenance every 1,000 hours,” including cleaning and checks for cracks and dents, Gazprom said in a statement. Gas transmission will resume at the rate of 33 million cubic meters per day if no malfunctions are detected, it said.
Front-month Dutch TTF natural gas futures added 19% to a fresh record high of 291 euros per megawatt hour. The euro, meanwhile, plunged below parity against the US dollar on Monday.
The “three-day pause will once again raise fears that the Kremlin will weaponize gas supplies and use the maintenance as an excuse not to resume flows. With storage still below where the EU wants going into the winter, that means a greater risk of shortages and much higher prices,” Craig Erlam, senior market analyst at forex trading firm Oanda, said in a note.
