The price of natural gas (Henry Hub) has risen to over $7, a price last recorded in 2008. Year on year, the price has already risen by over 92% and currently stands at $7,189.
Russia, which is currently facing heavy sanctions from the West, is having a hard time because exports have declined, according to Russian President Putin. Some countries, including the U.S., have imposed an import ban on Russian energy products such as coal, gas, and crude oil. The EU recently imposed a ban on coal exports from Russia and is open to further sanctions if the war continues.
Russia is therefore eager to find new distribution channels for its energy products inside and outside Russia.
“As for Russian oil, we will be able to raise their domestic consumption, stimulate higher complexity of feedstock processing and raise energy supplies to other parts of the world — somewhere, where they are really needed,”said Putin on Wednesday.
Some exports of energy products to Asia have increased but at very high discounts. In addition, there is still no infrastructure like in Europe, which means that shipments have to be transported long distances to Asia by sea.
The increase in gas prices came after consumer prices rose in March to levels last seen 40 years ago. In March, the consumer price index (CPI) rose 8.5% YoY, While producer prices rose 11.2%, the highest since the data was recorded.