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European gas futures rose 10% on Monday hours after German Foreign Minister Annalena Baerbock said the Nord Stream 2 pipeline could not be licensed in its current form because it was not not in accordance with EU law.
Speaking on ZDF TV on Sunday evening, Baerbock said the three parties making up Germany’s new government – the Social Democrats, the Greens and the Liberals – had agreed that all energy projects, including Nord Stream 2, had to be compliant. to EU energy legislation.
“This means that, as it stands, this pipeline cannot be approved because it does not meet the requirements of European energy law,” she said.
She said the situation on the Ukrainian border, where Russia has amassed 100,000 troops, was “also a factor”.
“The last government agreed with the Americans that if there were further escalations, this pipeline could not be brought into service,” she said.
Nord Stream 2, whose use has been terminated but whose use has not yet been authorized, will double the capacity of the existing submarine route between Russia and Europe. US and EU critics of the project say it will increase the EU’s dependence on Russian energy exports and also allow the Kremlin to put pressure on Ukraine, which could be denied gas fees. lucrative gas transit if the pipeline goes ahead.
European natural gas futures reached their highest levels since early October. The European gas benchmark for December deliveries jumped 10% Monday morning to reach a high of € 115.70 per megawatt hour, against € 105.35 on Friday and just below the record of € 117.50 in October.
Nord Stream 2 AG, the company operating the pipeline, and Russian Gazprom both declined to comment.
“The company works with the regulator and responds to all of its requests. We just need to be a little more patient, ”Kremlin spokesman Dmitry Peskov told reporters, according to Interfax.