Status: 11/17/2021 1:30 p.m.
In view of the delay in Nord Stream 2, the nervousness in the gas market is increasing. Experts warn that now not only gas prices but also oil prices could rise more strongly.
The setback for the Nord Stream 2 project has also caught investors on the European gas market on the wrong foot. In the morning, the gas price at the Dutch TTF hub climbed to a four-week high of just under 100 euros per megawatt hour. This also pushes up the prices in EU emissions trading, which set a new record high at almost EUR 68 per ton.
The Federal Network Agency had temporarily suspended the certification of Nord Stream 2 yesterday. According to experts, the approval of the controversial gas pipeline is now likely to be postponed by several months. There is already talk of summer 2022.
Doubts about Russia’s gas delivery promise
That doesn’t bode well for the European gas supply this winter. There are currently many indications that Russia will only be ready to noticeably increase its gas supplies to the EU when Nord Stream 2 can be put into operation.
“This raises concerns that Russia will not keep its promise of higher deliveries,” emphasizes Barbara Lambrecht, raw materials expert at Commerzbank. Especially since deliveries via the German Mallnow hub have barely increased recently.
On the booking date on Monday, the state-controlled Russian gas company Gazprom had not booked any additional transport capacities for the Yamal and Druzhba pipelines (“Friendship”) for December. Experts like Lambrecht see this as a signal that Russia hardly wants to expand its gas supplies to Western Europe.
Substitution effects as oil price drivers?
Companies, consumers and investors should now keep a close eye on rising gas prices. The delays at Nord Stream 2 could also lead to substitution effects for other raw materials such as oil, as Jürgen Molnar, capital market strategist RoboMarkets, emphasizes.
Indeed, oil and gas are good substitutes for many applications. In power plant operations, for example, there is the technical possibility of switching from gas to oil firing to a limited extent at short notice. If the gas price rises disproportionately, some electricity producers could switch to oil.
The rising demand would, in turn, drive up the price of oil. According to analysts, the price for the “black gold”, which recently moved at a good 80 dollars per barrel (159 liters) of the North Sea Brent, could rise towards 90 dollars. That would also boost fuel, heating oil and electricity prices accordingly.
But the bottom line is that the situation on the oil market is much more relaxed than on the gas market. This is not least due to the large reserve capacities of the OPEC oil cartel and the increasing fracking oil production in the USA. Yesterday the International Energy Agency (IEA) even dared to predict that the oil price rally could be nearing its end.
More than 300 basic gas suppliers are increasing their prices
Last but not least, that would be positive news for consumers and companies in Germany, who are plagued by high gas, fuel, heating oil and electricity prices. According to a current survey by the consumer portal Check24, 302 basic gas suppliers have already increased their prices or announced price increases. Individual suppliers even doubled their prices.
On average, prices soared 22 percent. A model household with a consumption of 20,000 kilowatt hours therefore has to cope with additional costs averaging 329 euros per year.