European gas supply concerns were stoked again early this week after the U.S. imposed its latest sanctions targeting Russia’s Nord Stream 2 gas pipeline. The Kremlin has called the move “illegal,” according to a Bloomberg report.
Benchmark European gas prices – the Dutch TTF front month (currently December) – had risen 8.7 percent to €91.35 a megawatt hour by 4:59 p.m. (GMT) on the day on Nov. 23.
In August, the U.S. sanctioned two Russian entities over their involvement in the Nord Stream 2 pipeline, as well as a ship that was involved in the link’s construction. The move had a limited impact on European gas prices at the time, and analysts said these new penalties probably will not push gas futures higher over the longer-term either, according to the report.
The latest U.S. sanctions are thought in any case to probably have come too late, as construction of the pipeline was finished in September and the first of the two lines already is filled with gas.
But the start of commercial operations of the pipeline suffered a setback last week after the German regulator Bundesnetzagentur suspended the certification process for the pipeline (GM Nov. 19, p. 1).
According to a tweet by Bundesnetzagentur, cited by a bne IntelliNews report, the regulator decided to suspend the process until the Nord Stream 2 holding company has reorganized its legal structure to conform with German law. This will involve the transfer of the assets and people to a subsidiary.