International Energy Agency (IEA) Chief Fatih Birol said on Wednesday that Russia may seek to cut off gas completely and advised the European Union to work on contingency plans, as reported by Reuters.

"Russia is seeking leverage over European countries in the winter months," Birol added. "Russian reduction of gas flows is designed to make it harder for Europe to fill up its storage."

Market reaction

Safe-haven flows continue to dominate the markets after these comments. As of writing, the Euro Stoxx 600 Index was down 1.4% on a daily basis.