Europe’s gas supply concerns have temporarily eased as the outage affecting Norway’s gas exports to Britain is expected to be repaired by Friday, according to the pipeline operator Gassco. The outage had driven up European gas prices to their highest level since December on Monday.
The benchmark Dutch front-month gas contract, the European reference price, shed 4% to 34.93 euros/MWh by 0925 GMT on Tuesday, as the news of the limited repair time calmed supply crunch fears.
On Monday, the outage had driven European gas prices to a peak of 38.56 euros, raising concerns about tighter supply amid worries over remaining Russian volumes and an Asian heatwave increasing competition for liquefied natural gas (LNG).
Norway overtook Russia as Europe’s biggest gas supplier in 2022 after Moscow’s invasion of Ukraine, making any outages at Norwegian fields a potential trigger for higher prices. Norway provided 26% of all natural gas consumed in Britain and the European Union last year, according to the Norwegian Offshore Directorate.
Gassco, the operator of the Norwegian gas infrastructure, stated that the repair is expected to take until Friday, based on information from the field operator Equinor. While the timeline could change, the repairs are not expected to take weeks.
The outage has once again highlighted the risks and vulnerabilities in the European gas market, which remains highly dependent on individual producer countries like Norway. Analysts warn that such supply disruptions serve as a fresh reminder of Europe’s continued reliance on Norwegian gas, even as the continent works to diversify its energy sources.