The European natural gas price has risen sharply since mid-June because gas flows from Russia have been reduced. The gas price could well climb further, in the view of strategists at Commerzbank.

Strike in the Norwegian oil and gas industry

“Annual maintenance of the Nord Stream pipeline is scheduled to begin at the start of next week. During this time, gas flows will come to a complete standstill for ten days. It is doubtful whether Russia will supply more gas via the other pipelines instead. The concern is rather that gas shipments may be even further reduced or not even resumed at all following the maintenance work. This would make it virtually impossible to replenish European natural gas stocks for next winter and would necessitate further-reaching political measures and cuts to gas consumption.”

“A decline in gas supply from Norway is looming in the near future. A strike in the oil and gas industry began there today that could paralyse around 13% of gas production, according to the Norwegian producers’ association. If the strike were to last any length of time, the already tight supply situation on the European gas market would further deteriorate, which we believe would cause the gas price to climb even further.”