European Stocks Plunge, Gas Prices Surge... Impact of Russia's Gas Supply Cutoff

A photo taken on the 31st of last month (local time) of a natural gas power plant operated by the French energy company Engie in Drogenbos near Brussels, Belgium.
[Image source=Yonhap News]

As Russia halted gas supplies to Europe, stock prices in major European countries, centered on Germany, plummeted.

As of 10:08 a.m. on the 5th (local time), the DAX index on the Frankfurt Stock Exchange in Germany was trading at 12,618.55, down 3.31% from the previous trading day's closing price. The DAX index approached its yearly low of 12,390.

France's CAC40 index fell 2.42%, and the pan-European Euro Stoxx 50 index dropped 2.75%. The FTSE 100 index on the London Stock Exchange also fell 1.15%.

European gas prices are soaring. On the Dutch energy futures market, the October delivery Dutch TTF gas futures price rose intraday by 26.5% from the previous trading day to 271.5 euros per megawatt-hour (MWh).

Accordingly, the next month's gas futures price, which had surged to 346.5 euros on the 26th of last month before falling back, is again recording a sharp rise. Compared to a year ago, it has increased by more than 800%.

At 5:35 a.m. GMT on the same day, the euro exchange rate in the foreign exchange market fell to $0.9884 per euro, marking the lowest level since December 2002.

Earlier, on the 2nd (local time), Russia's state-owned gas company Gazprom notified that it would stop gas supplies through the Nord Stream 1 pipeline, which supplies natural gas to Germany and other parts of Europe via the Baltic Sea seabed, citing a leak in the pipeline as the reason.

Since the invasion of Ukraine, Russia has been reducing natural gas supplies to Europe as retaliation against sanctions imposed on it.

This content was produced with the assistance of AI translation services.