Gas prices have spiked after Gazprom cut off gas flows into Europe via the key Russia-Germany Nord Stream 1 pipeline.
UK gas prices have skyrocketed 25.9 per cent, while European benchmarks have also risen a vast 24.7 per cent, amid renewed concerns over supply shortages this winter.
Prices were already historically elevated following continued volatility in the market after Russia’s invasion of Ukraine in February.
The Kremlin-backed gas giant has blamed the closure on maintenance issues caused by Western sanctions, suspending flows from the pipeline indefinitely after three days of maintenance.
Gazprom revealed on Friday it could no longer provide a timeframe for restarting deliveries after finding an oil leak that meant a pipeline turbine could not run safely.
This claim has been disputed by the West, which consider faults with pipeline politically motivated and confected in response to sanctions.
In recent months, flows have been reduced to 40 and then 20 per cent following a dispute in July with the European Union (EU) and Canada over a sanctioned Siemens turbine for one of the pipeline’s processors.
Deputy Prime Minister Alexander Novak told Russian state television that Siemens Energy must fulfil the terms of the turbine maintenance contract to bring the pipeline back online.
Siemens Energy has said it had not been commissioned to carry out the work but that it was available if requested.
Meanwhile, the Kremlin has warned the West it will retaliate against any price caps imposed on Russian oil.
“There can only be retaliatory measures,” confirmed Kremlin spokesman Dmitry Peskov.
Finance ministers from the G7 reached an agreement last week to cap Russian oil, in an attempt to slash record oil revenues funding the country’s invasion of Ukraine.
Moscow has vowed to halt sales to countries imposing it.
EU races to secure gas supplies as winter looms
The EU is currently scrambling to secure supplies ahead of winter, chasing to reach storage capacity targets across the bloc ahead of winter.
Energy ministers from the member states will discuss options later this week on 9 September to rein in prices to ease the pain facing hundreds of millions of households,
They will discuss options to rein in soaring energy prices including gas price caps and emergency credit lines for energy market participants, according to a document seen by news agency Reuters.
Ministers will also consider offering urgent “pan-European credit line support” for energy market participants facing very high margin calls.
Last week, Finland and Sweden on Sunday announced plans to offer billions of dollars in liquidity guarantees to power companies in a bid to prevent ballooning collateral requirements from toppling firms.
Any emergency EU policies would likely need to be proposed by the European Commission, which is currently drafting proposals.