Putin yesterday spoke at a meeting of gas producing nations in Russia describing how "the era of cheap energy resources, of cheap gas, is of course coming to an end".
A few thoughts:
The market, not Putin, sets the price. Unless Putin can manipulate the market (for example by forming a price fixing cartel, like Opec), this is just bluster.
The gas market is dominated by the oil market - the price of gas is linked to the price of oil:
The price of oil, whilst dropping, is cronically unstable. This suggests the price of gas is cronically unstable.
The UK weren't invited - not even as observers (like the norweigens). This is probably because we're running out of natural gas, rather than our inability to get on with the russians.
Why am I blogging about this?
Well, as we saw last week the price of electricity is set by the price of gas.
That probably means more expensive electricity.
It also might make gas less profitable - encouraging the use of coal.
Time will tell.
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