European natural gas prices rose, following 3 days of declines, with the market focused on the risk of supplies from Russia and a major heat wave bearing down on parts of the region.
Gazprom PJSC has declared force majeure on shipments to several European buyers over the past month, according to people familiar with the matter. The move may signal that it intends to keep supplies capped, reinforcing Russia's grip on the region's energy.
In June, Russia slashed its exports to Germany via the major Nord Stream link - the main pipeline to the European Union - citing delays to gas-turbine maintenance, following western sanctions against Moscow. One turbine was flown from Canada to Germany on Sunday and could arrive in Russia in about a week, Russia's Kommersant newspaper reported Monday.
Some analysts are skeptical the pipeline will immediately return to normal flows after separate, annual maintenance - which halted shipments completely - is completed this week.
"Now that Germany and Canada found an arrangement around the sanctions to bring back the turbine that powers Nord Stream 1 pipeline, it will be interesting to see what other reason Gazprom uses to justify force majeure," said Leslie Palti-Guzman, chief executive officer of New York-based consultancy Gas Vista.
Meanwhile, extreme heat continues to bear down on western Europe, boosting the need for cooling and electricity. Temperatures in parts of the UK, including London, could reach an all-time high on Tuesday (Jul 19). Paris and Amsterdam are expected to peak at levels just shy of records, according to forecaster Maxar.
Dutch front-month futures, the European benchmark, rose 1.4 per cent to 159.50 euros(S$226.8) per megawatt-hour by 9.14 am in Amsterdam. BLOOMBERG