Natural gas prices in Europe surged on Monday to their most expensive since the early stages of Russia’s invasion of Ukraine as proposed strikes in Norway increased fears about inadequate supply.
Natural gas on the Dutch-based TTF trading hub at one point rose more than 10% to change hands above 160 euros a megawatt-hour for August futures. A year ago the product traded for 22.4 euros.
The ICE U.K. Natural Gas contract GWM00, +18.49% jumped 20% to 289.29 pence per therm, compared to 93.12 months ago.
News that industrial action by workers would see six Norwegian natural gas fields shut down over the next few days, potentially cutting the major exporter’s supply by 13%, added to the angst of a market already worried about reduced output from Russia.
Moscow has responded to sanctions imposed over its invasion of Ukraine by slashing shipments through its Nord Stream pipeline by 60% in June.
Concerns are growing that large swaths of European industry may struggle to maintain optimum activity levels should natural gas need to be rationed when demand increases during the northern hemisphere winter.
In addition, economists are wary that corporate profit margins may be cut sharply by the surging energy input costs.
And any price rises that are successfully passed on to the consumer will exacerbate concerns about the surging cost of living across the region. The U.K on Monday was hit by disruption across parts of its motorway network as protestors complained about the price of vehicle fuel.
Meanwhile, Nymex U.S. natural gas futures NG00, +1.47% rose 0.5% to $5.742 per British thermal unit, well off the multi-year peak above $9 touched just a month ago.