The Passing of Winter Does Not Mean the Energy Crisis Is Over: European Natural Gas Prices Hit Record High

SHANGHAI, Mar 3 (SMM) – On Wednesday (March 2) local time, European natural gas prices broke a record high as traders worried that the escalation of the Russian-Ukrainian conflict could lead to disruptions to natural gas supplies.

Dutch TTF benchmark natural gas futures briefly jumped to as high as 194 euros ($215) a megawatt-hour, up 60% from Tuesday's close and doubled Friday's close.

As of the close, Dutch TTF benchmark natural gas futures fell to 165 euros/megawatt-hour, still the highest closing price since December 22 last year, an increase of 35%. The most-traded natural gas futures contract in the UK also rose 35%, while US natural gas futures traded in New York rose 4.4%.

Alex Froley, a market analyst at ICIS in the U.K., said gas pipelines from Russia to Europe are proceeding as normal, but many uncertainties are worrying traders and investors.

 Europe relies on Russia for about a third of its natural gas imports, and any disruption could keep prices high for a long time. Natural gas supply will be a challenge this summer, and Europe's energy shortages are likely to persist for quite some time.

Aside from soaring natural gas prices, international oil prices also advanced further following sharp increase. U.S. WTI crude oil futures for April delivery closed up 6.95% at $110.6 a barrel; Brent crude futures touched $115 a barrel, the first time since 2008.