September 26, 2022
17:04
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The renewed European “gas cap” and recession fears are putting downward pressure on gas prices.
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The price of gas dropped slightly below 170 euros per megawatt hour around noon. This marked the lowest level since the end of July. We are currently at € 177, 2 percent less than on Friday and about half less than a month ago.
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The drop in the price of gas appears to be the result of the relaunch of the European “gas ceiling” in the form of a “gas pipe”. This is a bandwidth for the price of gas that evolves along with the prices of the international market. The European Commission also wants to combat speculation and manipulation in the energy markets. Reports of such measures alone have pushed the price of gas down drastically in recent weeks as it pushes speculators predicting a further hike out of the market.
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It was also previously announced that Norway, which had not moved until recently, now seems willing to talk about a price cap.
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Fear of a recession can also play a role. dand OESO planned that the eurozone will grow by only 0.3 percent next year, up from 1.6 percent previously. Germany would be the first major European economy to plunge into recession in 2023, with a 0.7% contraction.
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This is also evident from the If0-index, which reflects the mood of German entrepreneurs. This month it dropped to 84.3 points. This is the lowest figure since May 2020 and lower than estimated. “The German economy is sliding into recession,” said Ifo president Clemens Fuest. The outlook is bleak due to the energy crisis and high inflation.
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