Gas prices in Europe rose after an attack on a transit point in the Kursk region - Bloomberg

European natural gas prices have risen sharply after an attack on a pumping station in the Kursk region of the Russian Federation, which was part of an inactive connection that until recently supplied fuel to Europe. This is reported by Bloomberg, writes UNN.

Futures prices rose 6.2% in early trading on Friday. The General Staff of the Armed Forces of Ukraine confirmed that the Sudzha gas measuring station was shelled, but noted that it was the Russians who attacked the facility, pointing to previous cases when Russia probably sent soldiers through a disabled gas pipeline

Bloomberg notes that serious damage could make the resumption of Russian gas supplies unlikely, and this prospect has already diminished after a 30-day truce did not lead to an immediate start to peace talks. The leaders of Russia and Ukraine have indicated that they would agree to a ceasefire on attacks on energy infrastructure, but so far this has not led to a halt in attacks.

This transit point is part of a gas pipeline that supplied Russian gas to Europe until the beginning of this year. Some countries that previously depended on these supplies hoped that they would resume again. NASA satellite images indicate large-scale fires covering the territory of the gas station and the surrounding area, recorded between 6 and 12 hours ago.

Those in the gas market who hope that Russian exports can resume through this transit point after the end of the war will now assess the extent of infrastructure damage and, most importantly, how quickly Gazprom can restore it

Addition

Gazprom, which previously controlled this transit point, did not respond to Bloomberg's request for comment. Although Ukrainian troops made a surprise intervention in the Kursk region in August, Russian troops quickly regained most of the territory this month.

The operator of the gas transmission system of Ukraine refused to comment on the incident on the territory of Russia.

Russia used several border points to supply gas to Europe through Ukraine, but their number had decreased to two by 2022 after the start of Moscow's full-scale invasion. In May of that year, supplies through the Sokhranivka point were stopped after Ukraine stated that it could not control the facility due to the occupying forces.

Flows of Russian fuel through Ukraine stopped at the beginning of this year, when the transit agreement ended, and expensive liquefied natural gas cargoes leave Europe open to competition from other buyers. Europe faces challenges with reserves after stronger-than-usual withdrawals this winter season, which led to a decrease in gas reserves to the lowest level since 2022.

Gas futures in the Netherlands, the European benchmark, were 2.7% higher at EUR 43.99 per megawatt-hour at 9:45 a.m. in Amsterdam.

The market reaction on Friday suggests that "at least a partial recovery of flows has been priced in by the market," said Bloomberg Intelligence senior analyst Patricio Alvarez.

Without any changes in supply caused by the geopolitical situation, European gas markets are likely to contract this summer as the region works to fill a larger gap in inventories

 Reminder

On the night of March 21, explosions rang out at the "sudzha" station, which is the only gas transit point from the Russian Federation to Europe. Russian war correspondents claim a Ukrainian strike.

In response, the General Staff reported that the Russian accusations are unfounded, because the station has been repeatedly shelled by the Russians themselves. Today, the enemy strengthened the information influence with another provocation, shelling this object, the General Staff stated.