State-owned Gazprom dropped plans to resume limited pumping on Saturday after a maintenance shutdown, blaming a leaking turbine. The decision – which European governments say is in retaliation for Western sanctions over Russia’s war in Ukraine – was inevitably reflected when markets opened for business on Monday morning. The top European benchmark, known as the Dutch TTF, which has risen more than 400% in the past year, rose a further 30%. The contract for October delivery in the UK – which does not depend on Russian energy but is exposed to wider market pressures – was 25% higher. Stock markets were also jittery with Germany’s DAX down almost 2% due to Russia’s decision. The FTSE 100 in London opened 0.7% lower thanks only to its strong energy component lineup. In normal times, Nord Stream 1 carries a third of Europe’s supply from Russia. Record prices, due to limited natural gas flows from Russia during the summer, have already led some energy-intensive industries to cut production, particularly in Germany. Use Chrome browser for more accessible video player 2:44 Russia closes gas pipeline to Europe Berlin on Sunday unveiled a €65bn (£56bn) package to help households and businesses deal with the price challenge. The measures, Germany’s third set during the crisis so far, include tax breaks for manufacturers and subsidies for the lowest paid. The UK is under increasing pressure to follow suit to better protect consumers and companies from the worst effects of the cost of living squeeze. Liz Truss, who is widely expected to beat Rishi Sunak to the doors of No 10 when the result of the Conservative leadership contest is announced at midday on Monday, has promised to reveal details of her plans within a week if she wins. Use Chrome browser for more accessible video player 0:25 Liz Truss promises ‘no new taxes’ The Bank of England has warned of a recession leading to energy given the bill’s forecast – widely expected to top £5,000 on an annual basis next year given the path for wholesale costs. Ms Truss argued during the leadership campaign that the recession was not inevitable. Options for the next prime minister include tax cuts, further grants to help boost bills and a plan, similar to that unveiled by Labour, to freeze the energy price cap.
