On a chaotic day that saw European benchmark natural gas surge 40% in a few minutes, Putin eased prices by offering to help stabilize the situation. Russia could potentially export record volumes of the vital fuel to the continent this year, he said. Dutch and UK gas futures plunged more than 7% on his remarks after earlier hitting records, while U.S. prices for the fuel dropped 10%. But spot liquefied natural gas in Asia still soared to an all-time high.
Europe's energy crisis is rippling through stock and bond markets, spurring inflation fears and threatening to cripple major industries. The region`s governments are struggling to respond, with little more than hopes for a mild winter to cushion the blow.
Lower-than-anticipated supplies from Russia, the region's largest supplier, have been a major cause of the dire situation, according to some European officials.
Gazprom's daily exports to Europe were close to record volumes earlier this year, but they fell in September amid increased domestic demand due to an early start of the heating season. The company also continues its storage-injection campaign at home, which is scheduled to end by Nov. 1.
Stabilize Markets
Putin asked his government and energy executives for proposals on how to stabilize the energy market, and Nord Stream 2 wasn't the only proposal. Novak, former energy minister and one of the architects of OPEC+, also suggested selling some additional volumes on Gazprom's own electronic platform based in St. Petersburg.
Putin said the current market crisis is the result of a faster economic recovery around the world, which has [warmed up" demand for energy. An unexpectedly long and cold winter has depleted Europe's gas storage, he said.
Yet he also highlighted a mistake" made by European authorities to shift from long-term contracts typically favored by Russia to short-term sales on the region's exchanges.
Today it has become absolutely obvious that this policy is erroneous," Putin said. [As a result, now the gas price has broken all historical records and today it's already striving to $2,000 dollars per 1,000 cubic meters."