Another surge in energy prices beckons in Europe after Russia has decided to keep the Nord Stream pipeline shut, citing a "leak" found during maintenance. This came at the end of the supposed three-day repair period and now the flows will be put off indefinitely instead.
Let's be real. Nobody believes the "leak" story and everyone knows Russia's game here. But the issue is, they are not out of place to play things out in this manner. And the real hurt is going to be felt by European households and businesses in the months ahead.
Sure, flows via the Nord Stream pipeline were already reduced to 20% capacity but for it to be taken out altogether, it just exacerbates the gas shortage that Europe will face in the months ahead. Some countries may have enough storage to brave through winter but we will run back the same problems again next year and that's a major worry.
The euro already took a tumble late on Friday but European benchmark energy markets were closed. Be wary of a spike at the open later today.
/EUR
