Traders expect European gas prices to remain elevated for years to come, pushed higher by supply strains, even after Russian president Vladimir Putin allowed flows to resume last week through a critical pipeline.
The price of gas set to be delivered to Europe at this time of year in 2023 and 2024 is near its highest level on record at €134 and €82 per megawatt hour respectively, according to trading in yearly forward contracts used by consumers of the fuel to lock in long-term prices. Before last summer, European gas prices traded consistently below €40 per MWh for more than a decade.
Gas prices doubled in June when Moscow cut flows ahead of scheduled maintenance work on the Nord Stream 1 pipeline into Germany. But despite Russia switching the taps back on this month, fears of more potential disruption have kept futures contracts close to record levels.