From Russia With 50% Less Supply: European Nat Gas Prices Explode To Record Highs As Putin Turns The Screws

That giant sucking noise is billions of "Excess euros" being wired to Russia as Putin flexes his muscles showing Europe just how "Transitory" record nat gas prices can be.

Natural gas prices in Europe hit a new record high as a slow at first, then much faster tightening of Russian supply looks set to cause a storage crunch on the continent.

As the chart below shows, the amount of gas entering Germany at the Mallnow compressor station has plunged by almost half, signaling Russia is flowing less through the Yamal-Europe in what may be a Kremlin shot across the European bow, and a reminder who literally keeps the lights open during the winter.

As Bloomberg notes, the extraordinary, globe-spanning supply crunch in natural gas has fueled "Eye-watering price rallies from the Netherlands to China, and investors are primed to see whether the gains are extended." Indeed, it's not just Europe: Asian liquefied natural gas prices are nearing a seasonal high as importers compete for supply amid the hotter summer weather.

A worst case scenario could see European gas prices explode to suborbital levels that would make Jeff Bezos proud should the continent fail to stock up on sufficient nat gas amounts.

Although European storage inventory is now approximately at 2018 levels, that has been supported from a much higher starting position, and the circumstances surrounding Russian supply to Europe are very different this year.

In 2018's "Beast from the East", spot gas prices still spiked with European storages 28% full at 29.27 Bcm due to regional influence, particularly from the UK, where there were reports of NBP traders losing an entire year's profit as they were caught short of the record spot prices.

https://www.zerohedge.com/markets/russia-50-less-supply-european-nat-gas-prices-hit-record-putin-turns-screws