Bloomberg: Russia-Ukraine Crisis Shields EU Gas From Oil Price Rout

The risk of disruptions to Russian natural gas flows through Ukraine this winter is protecting European prices from the rout that sent oil to a four-year low.

U.K. gas for next quarter fell 13 percent since mid-June, less than half the 29 percent plunge in Brent crude over that time. While Brent is typically the benchmark used to set the price on almost half the gas supply in Europe, the Russia-Ukraine conflict and demand fundamentals in the market are having a bigger impact on prices than the decline in oil.

First-quarter supply interruptions are still possible as Ukraine may struggle to pay Russia the full $3.1 billion by year-end under an agreement brokered by the European Union last week for gas already consumed, according to Societe Generale SA. OAO Gazprom said it received the first tranche of payments today.
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