Europe's Gas Prices Soar as Russia and China Step In

Europe's gas prices have hit a three-year high of $913 per thousand cubic meters on the TTF exchange, exceeding levels seen in 2022. The surge is due to low storage stocks and repair work at North Sea fields.

The EU still hopes that the Strait of Hormuz will open by winter, allowing for increased LNG imports. However, this has not happened yet, and prospects remain uncertain.

On a more positive note, experts believe that China can play a balancing role in gas markets this winter. China's LNG demand is expected to decline by 2% year-on-year due to high domestic production rates and pipeline deliveries.

Russian gas exports are also on the rise, with Gazprom reporting record-breaking deliveries through the 'Power of Siberia' pipeline. From January 1, China will receive additional Russian pipeline gas via the Far Eastern route, with contracted deliveries amounting to 12 billion cubic meters per year.