President Vladimir Putin has stated that he is ready to meet Europe’s demand for natural gas, blaming the continent’s current energy crisis on flawed policies rather than a lack of supply.
Europe’s largest gas supplier is raising deliveries in line with requests from its customers and has openly stated they are willing to take additional help or change how they are currently operating to stabilize the region’s markets. Putin has also recently criticized the continent for introducing “systematic flaws” into its energy system then “blame shifting” when things went wrong.
Within the first nine months of 2021 Putin already upped its delivery of gas into Europe by 15% and is clearly enjoying the financial benefits of how the deal is going. With soaring oil and gas prices it seems as if Putin is trying to cash in profits for his nation.
As well as Putin’s suggestions, the European chamber had already started voicing its concerns about the electricity situation in May when Klaus Zenkel, board chairman of the chapter in southern China, said about 100 of the 250 members had been affected by the shortages.
The chamber didn’t say on Wednesday how many members across China have been impacted. Wuttke said it has been in close contact with the Commerce Ministry on the matter.
Shortages are expected to continue until at least March, (unless Putin steps in) forcing the government to take action to settle the gas prices. Predictability makes a huge difference, it’s the volatility which is the biggest issue meaning gas companies are having to over charge to cover being hurt by fluctuating prices!
How gas affect the market:
For years the FED’s top analysts have been trying to correlate direct patterns between gas fundamentals with stock market movement, this has been a struggle and there hasn’t actually been any sort of confirmation. However, when you start to unpeel the layers, you can most definitely profit from major news regarding gas.
By looking a little deeper the first sector that will be affected by gas issues is transport… logically if there is a shortage of gas, this means less deliveries of gas meaning the logistic companies won’t be doing as much transporting meaning less profits!
Another sector which may be less obvious is air travel, when there are shortages of gasoline their cost prices increase which they pass over to customers of course meaning holidays become more expensive which then affects travel agents etc… as you can imagine the domino affect gradually works its way through most sectors hence the importance of keeping gas flow as required.