By Swann Collins, , investor, writer and consultant in international affairs. Eurasia Business news, February 23, 2022

Gas prices in Europe for the first time in 2022 exceeded $1,000 per thousand cubic meters, according to data from the ICE Futures exchange.

On Wednesday afternoon, the price of the nearest (March) gas futures on the TTF hub reached $1,004 per thousand cubic meters, while on Tuesday trading on the TTF closed at $925.

Previously, gas prices over $1,000 dollars was traded in Europe in December 2021.

The main political news that affect gas prices is that the German authorities decided to halt the Nord Stream 2 Baltic Sea gas pipeline project, designed to double the flow of Russian gas direct to Germany.

Geopolitical tensions around Russian and Ukraine and the new Western sanctions after Moscow officially recognized the separatist republics of Donetsk and Luhansk and sent troops in Donbass have also increased worries about a potential cut of Russian gas supplies to Europe.

Higher gas prices should boost inflation in Europe in coming months. The annual inflation in the Euro area in January 2022 was 5.1%, never seen since 1992.

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Among the routine industry processes are a cold snap in Europe and a reduction in electricity generation from renewable sources, the resumption of business activity after the holidays in Asia and a new increase in LNG prices on the Asian Platts JKM index.

Oil prices are also skyrocketting and rose to just short of $100 a barrel on Tuesday as traders worry of a possible disruption of exports from major oil producer Russia, after Western sanctions taken on February 22. The last time oil prices hit such level was in 2014, during the Ukrainian crisis. Investors should prepare to lasting high inflation in industrial and consumer prices.

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© Copyright 2022 – Swann Collins, investor, writer and consultant in international affairs.