Natural gas prices in Europe fluctuated as traders weighed threats to supplies amid mounting calls for new sanctions against Russia.
Benchmark futures swung between gains and losses, after jumping as much as 7% earlier. Some European Union members are pushing for the group to quickly impose new penalties against Moscow after reports of atrocities near Kyiv.
Still, for now shipments from Russia via key pipeline routes remain broadly stable, which together with high wind output in some parts of Europe are keeping prices in check. Colder temperatures are also set to ease later in the week, forecaster Maxar said, which would reduce demand for gas.
There’s been no disruption in Russian gas supplies so far, “but the market will certainly remain extremely volatile in the coming days as everyone continues to follow the news,” trading group Energi Danmark said in a note on its website.
Traders are watching moves from both Russia and its gas buyers after Moscow last week initiated ruble payments for the fuel. While some are still assessing the plan, Lithuania, a relatively small client, has fully ended gas imports from Moscow in response to the demand.
Dutch front-month gas, the European benchmark, was up 1.3% at 113.65 euros a megawatt-hour by 10 a.m. in Amsterdam, after posting its first weekly gain in a month last week. The U.K. equivalent contract rose 3%.
“Geopolitical risk may keep gas prices higher for longer,” Bloomberg Intelligence analysts Henik Fung and Chia Cheng Chen said in a note. “The Kremlin’s call for ‘unfriendly’ European countries to pay for Russian gas in rubles raises the stakes for supply and the specter of disruption.”