Europe’s natural-gas markets are digesting the real possibility Vladimir Putin Cut off supplies to Germany. However, if the Russian president actually turns off the tap, things will get a lot worse.
The cost of liquefied natural gas – Europe’s alternative to Russian pipeline gas – delivered in the region this year has more than doubled in the past month to $50 per million British thermal unit, or MMBtu. Prices for delivery have also risen sequentially in the coming years as traders bet on gas shortages in Europe unless significant new LNG supplies go online.