European natural gas prices in the Dutch Title Transfer Facility (TTF) hit record high levels surging to €77 per megawatt-hour amid tight supply concerns ahead of winter and growing consumption on the continent.
Natural gas prices have started to increase since the beginning of the year due to extreme weather conditions.
The TTF gas price is calculated as corresponding to crude oil trading at around $150 per barrel, a figure that is double what crude is currently trading at.
In Europe, natural gas consumption in electricity generation grew due to increasing air conditioner usage and lower hydro and wind inventories.
Combined with fewer gas supplies from Russia to Europe and lower gas storage levels ahead of winter when natural gas consumption is expected to grow further, prices hit record levels.
Russian energy company Gazprom confirmed that gas storage inventories in Europe are 30% full.
The Kremlin spokesman Dmitry Peskov said Wednesday that a rapid startup of the Nord Stream 2 natural gas pipeline, which plans to carry 55 billion cubic meters of natural gas from Russia to Germany through the Baltic Sea, would balance high natural gas prices on the continent, including spot market prices.
Gazprom announced the completion of the construction of the Nord Stream 2 natural gas pipeline project last Friday.
According to Gazprom's statement, the cost of the pipeline project reached around €10 billion.
By Nuran Erkul Kaya