Breaking news: Austrian, Italian gas prices spike after grid explosion

The Austrian VTP Day-ahead contract jumped to more than €33/MWh on Tuesday morning, according to trades submitted to ICIS, following an explosion on the Baumgarten gas network.

Network operator Gas Connect Austria announced the incident on Tuesday morning, leading to bullishness in gas markets across Europe.

Estimated supply of Russian gas transiting Ukraine and Slovakia and entering Austria at Baumgarten was forecast to only reach 14.5 million cubic metres (mcm) by the end of Tuesday, according to Slovak grid operator Eustream. In December so far, the daily flow rate at this point has been 126.3mcm/day.

Russian volume also transits Austria and on into Italy.

Broker quotes seen by ICIS showed that the PSV Day-ahead was bid above €40/MWh, and the Within-Day changed hands at €50/MWh. Italy has been reliant on Russian imports in the last fortnight as a cold spike has caused consumption to spike. Italian supply from northern Europe via Switzerland are also curtailed by maintenance on the TENP pipeline.

The VTP Day-ahead had closed at €21.325/MWh on Monday.

Gas Connect Austria said flows in the east of the country will either cease or be heavily restricted.

The operator said the system was shut down in a controlled state, but that several fires were still being dealt with.

More to follow…