What Russia’s Gas Supply Halt Means for Energy Trade 

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  • Russia indefinitely halted gas delivery to Europe. 
  • Liberty Energy exec warns oil costs might double. 
  • IEO remains approximately 15% down since 2022 started. 

Euronext concluded Tuesday with red outlooks. That came after Russian President Vladimir Putin indefinitely stopped gas deliveries to Europe, citing the punitive sanctions against the country as it attacked Ukraine. 

Ukraine Conflict Might Witness Oil Price Doubling

The ongoing developments remain a considerable threat to the area & its financial status. Remember, Europe depends on natural gas for most of its energy requirements. Also, the possibility of Moscow suspending oil exports worsens the scenario. 

Liberty Energy CEO Christopher Wright believes that can see oil prices skyrocketing to new highs. From an investment standpoint, the energy news indicates that legacy oil firms remain the top pick for long-term investors. 

The US Plans to Replace Russia as Gas Supplier

The United States seems ready to supply 15B cubic meters of LNG (Liquefied Natural Gas) to Europe as it wants to lessen the region’s reliance on Russia. Wright told CNBC that the lucrative approach remains to increase the country’s capability to explore gas. He added that their current infrastructure allows them to send massive LNG amounts to Europe. 

Moreover, the US can supply more natural gas with increased LNG export terminals and pipelines. That means LNG & energy infrastructure firms are lucrative to own (for the long term). iShares United States Oil and Gas Exploration and Production ETF remained nearly 15% lower this year. Do you want to invest in this ETF (Exchange Traded Fund)?

Winter Is Imminent 

European regulators are fighting to secure enough gas supplies to ensure adequate energy to keep houses warm during the coming colder months. Energy economists say the latest move by Russia to halt gas delivery through Europe’s primary supply route might aggravate what had seemed a challenging winter phase.

The European energy sector remains in shock amid price volatility plus uncertainty over power balances as the winter approaches. Rystad Energy analysts noted that Western Europe has seen energy spot prices surging to unparalleled zones. 

What are your views about Europe’s energy crisis? Feel free to comment below.

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