Euro Slides To 20-Year Low After Putin Halts Gas Flows To Europe

Breaking Business Euro Slides To 20-Year Low After Putin Halts Gas Flows To Europe Robert Hart Forbes Staff I cover breaking news. Following New! Follow this author to stay notified about their latest stories. Got it! Sep 5, 2022, 05:32am EDT | Share to Facebook Share to Twitter Share to Linkedin Topline The Euro dropped to a two-decade low against the U.

S. dollar on Monday morning, gas prices soared and major European stock indexes dipped after news Russia had halted gas flows through a critical pipeline for the foreseeable future, deepening fears of an impending energy crisis this winter. Russia said the Nord Stream 1 pipeline would be closed indefinitely.

Getty Images Key Facts The euro dropped below $0. 99 for the first time in 20 years on Monday, marking the currency’s latest slide against the U. S.

dollar in recent months following Russia’s invasion of Ukraine. The British pound, one of the worst performing major currencies this year, fell as low as $1. 1444 on Monday morning, its lowest level against the U.

S. dollar since March 2020. European stocks also took a beating Monday morning, with Germany’s Dax down 3.

19%, France’s CAC 2. 31% and Spain’s Ibex 2%. London’s FTSE 100 blue-chip index was also down 1.

13% Monday morning, continuing a poor run from last week as the country prepares to name its next prime minister and battles soaring inflation. Natural gas prices in Europe also surged and Dutch TTF October—a key European benchmark— jumped 30% Monday morning. What To Watch For European gas prices jumped as high as 282 euros per megawatt hour on Monday morning, shy of August’s record high following Russia announcing another round of maintenance on the Nord Stream 1 pipeline.

After the latest turmoil and indefinite shutdown, analysts expect gas prices to reach new record highs this week. News Peg Russia’s state-controlled energy firm Gazprom announced on Friday that the Nord Stream 1 pipeline, which had been closed for maintenance work, would remain closed indefinitely following the purported discovery of an oil leak. The conduit is the single biggest gas pipeline from Russia to Europe and officials throughout the bloc have accused Moscow of weaponizing energy supplies to retaliate against Western sanctions for invading Ukraine.

Before the war, Europe relied on Russia for around 40% of its natural gas. Cuts to the flow of gas, as well as repeated shutdowns have worsened the already-turbulent market. Soaring prices and dwindling supplies have triggered an energy crisis in Europe and countries fear a tough winter lies ahead marked by energy rationing and shortages.

The Kremlin strongly denies it is playing politics with its resources—the indefinite shutdown was announced shortly after nations agreed to cap the prices of Russian oil exports—and blames sanctions for being unable to properly service equipment. European officials dispute this interpretation of sanctions and Siemens, which maintains the equipment Russia claims is faulty, says the issue as described should not halt gas deliveries. Further Reading Euro And Dollar Are Equal For First Time In 20 Years–Here’s What It Means For Americans (Forbes) Nord Stream 1: Gazprom announces indefinite shutdown of pipeline (Guardian) Follow me on Twitter or LinkedIn .

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