British and Dutch gas prices rose on Tuesday as fears over a possible disruption to gas supplies to Europe from Russia continued to push prices higher, despite physical flows remaining stable.

The British day-ahead gas price TRGBNBPD1 rose by 9.7% to 565 pence per therm by 0940 GMT. The British front-month contract TRGBNBPMc1 was 10.4% higher at 583 p/therm.

The equivalent Dutch front-month contract TRNLTTFMc1 rose 9.7% to 236.50 euros per megawatt hour (MWh)

“Although Russian supply continues to flow…. market participants continue to fear disruptions in the near future,” said analysts at Engie EnergyScan.

Traders said comments made by Russia late on Monday that it could cut gas supplies via the Nord Stream 1 pipeline to Germany in response to Berlin’s decision last month to halt the opening of the controversial new Nord Stream 2 pipeline, have spooked the market further.

Physical flows of Russian gas, however, remain stable.

Russian gas delivered through the Yamal-Europe pipeline via Poland was flowing westward into Germany on Tuesday morning, and flows into Slovakia via Ukraine remained at recent high levels, pipeline operator data showed.

Oil prices rose on Tuesday, with Brent surging past $126 a barrel, on fears of formal sanctions against Russian oil and fuel exports.

Germany’s Finance Minister Christian Lindner on Monday said it is not currently planning to stop importing Russian oil, gas and coal but is keeping the option open.

The European Commission is expected on Tuesday to outline plans to help reduce the bloc’s reliance on imports of Russian gas.

EU climate policy chief Frans Timmermans said the plans would “substantially reduce our dependency on Russian gas already this year, and within years will make us independent of the import of Russian gas.”

In carbon markets, the European Union benchmark carbon price CFI2Zc1 was up 4.72 euros at 63.02 euros a tonne.
Source: Reuters (Reporting By Susanna Twidale; editing by Nina Chestney)