Eurozone inflation is already skyrocketing and hit an annual rate of 9.1% in August. Russia cutting gas flows indefinitely on the critical Nord Stream 1 pipeline could worsen it. Dutch TTF futures, the European benchmark for natural gas, added 28% to 268 euros per megawatt hour. And German baseload year-ahead power, the European benchmark for electricity, soared 23% to 625 euros per megawatt hour.
The EU has proposed a price cap on gas and electricity rationing to control energy prices. The EU previously agreed to a voluntary 15% gas usage cut, but electricity demand has only decreased by 2.2% since the start of Russia’s invasion on Ukraine, according to Rystad Energy.
