- Germany’s Uniper warned that gas prices could rise even higher as supplies from Russia are hampered.
- The utility giant’s CEO stressed the need to address the impact of soaring prices on consumers.
- Even if the war ends, Uniper’s partnership with Russia’s Gazprom will fall apart, he said.
German utility giant Uniper has warned that gas prices could soar even higher as Russia cuts supplies to Europe.
In an interview with CNBC on TuesdayUniper CEO Klaus-Dieter Maubach highlighted the urgent need to address the impact of price spikes on consumers, especially as millions rely on natural gas for heating during the winter months.
“Look, the worst is yet to come,” Mobach said, noting that he wanted to educate policymakers about the dire prospects.
“We’re seeing prices in the wholesale market that are 20 times — 20 times what they were two years ago,” he continued, calling for an open discussion on how to address the issue.
European gas prices are up 300% this year as rolling gas cuts in Russia squeeze supply and push prices higher.although Netherlands TTF FuturesThe European benchmark gas price recently fell 10.5% to 220 megawatts per hour, after a 36% surge the previous day on news that Russia had suspended gas deliveries to Europe via the key Nord Stream 1 pipeline indefinitely due to a leak.
But before that, Russia cut flows to 20% of its capacity and shut down pipelines for 10 days for annual maintenance.
European leaders accuse Russia “weaponize” its energy In response to sanctions and boycotts imposed on the country following the invasion of Ukraine. Now, countries such as France, Germany and Italy are scrambling to figure out how to store energy ahead of winter.
Germany, which has been working with Russia on fuel for about half a century, has been hit hardest by Europe’s energy crisis. Even if Russia ends the war, relations between Uniper and Russian state energy giant Gazprom will remain damaged, Maubach said.
“I think this partnership has broken down and I don’t think we can recreate it in the weeks, months and years to come. So we’re focusing on alternatives to Russian gas,” he said. He added that gas prices are unlikely to drop immediately when the war is over.
“There will be a burden on our consumers and the industry as a whole for the next few years,” he said.
As part of Germany’s transition from Russian gas, Uniper recently started a mothballed coal-fired power plant to generate electricity. But with low water levels on the Rhine after a record summer heatwave, Germany’s fuel switch will face some hurdles.
