Due to lower gas prices in Europe, the russian budget will lose about $3 billion

Gas quotations in Europe have fallen to the levels of two years ago, before the energy crisis: on Friday morning, a thousand cubic meters at the TTF hub cost $275, while in the fall, $1000 seemed to be a "normal" price.

Prices have fallen threefold since the beginning of the year, due to a combination of factors:

1) large stocks for the end of spring (the EU's UGS facilities are two-thirds full),

2) a stable flow of LNG,

3) a drop in consumption

4) warm weather.

This could even lead to negative gas prices in the near future, Bloomberg writes, if suppliers find it more profitable to sell gas than to continue storing it.

The difficult situation in the industry, which is in no hurry to increase consumption, as well as energy saving policies, are also working to reduce prices.

According to the European Commission's forecasts, gas demand in the EU in the next 12 months may fall more than the volumes of pipeline gas and LNG that countries expect to buy from russia this year," Kommersant writes.

All of this means that gas prices in Europe are unlikely to reach the $700 target set in the russian budget before the fall.

If the average price of russian gas supplies during the year is $400 per thousand cubic meters, the russian budget will lose $3 billion in revenues in the form of gas export duties.

Unlike oil, it is very difficult to redirect pipeline gas to new markets, and the EU has firmly set a course to completely abandon gas imports from russia.

Background. To recap: European gas reserves exceed seasonal norms and are about 66% full, and some expect the storage facilities to be full as early as August, long before the start of the heating season.