European businesses run risk of shutting down due to rising gas prices, EC president warns

Surging prices for gas in the European Union expose enterprises across the bloc to serious risks of closing down, according to the president of the European Commission Ursula von der Leyen.

The price of November futures on the TTF hub in the Netherlands increased to $1,155 per 1,000 cubic meters on Wednesday, or €96 per megawatt hour in household terms. 

On Tuesday, gas prices saw a surge of more than 20%, with Europe continuing to struggle to meet increasing demand ahead of the winter season and with gas storage facilities on the continent less than full.

Meanwhile, Russia’s Nord Stream 2 pipeline, which could deliver the additional gas supplies that Europe needs, continues to face bureaucratic hurdles in Brussels.

At the same time, Russia’s Gazprom did not book additional capacities for the transit of natural gas through Ukraine for November, which were offered by the Ukrainian operator GTS.

“While Gazprom has honoured its long term contracts with us, it did not respond to higher demand, as it did in previous years. So Europe is today too reliant on gas,” the EC president said.

Von der Leyen stressed that the current prices for “the blue fuel” are pushing electricity costs higher across the EU. She added that households may hardly make ends meet, while companies are running risks of closing.

The official hit the theme of strategic importance to be less reliant on energy imports. She called for doubling down on a swift transition to clean energy like solar and wind, which can be domestically produced and will ultimately be a lot cheaper than imported fossil fuels.

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