European energy prices soared on Monday after Russia shut down its main pipeline to Europe, The Wall Street Journal reports.
Natural gas futures soared more than 30% on Monday, approaching an all-time high set last month.
The shift came after Russian-owned Gazprom announced it would shut down the Nord Stream pipeline indefinitely. The pipeline was scheduled to reopen after three days on Saturday due to an oil leak.
The announcement came after the G7 endorsed imposing a price cap on Russian oil in response to their invasion of Ukraine.
Over the weekend, the Swedish and Finnish governments offered billions in guarantees to utilities to avoid an energy crisis.
Officials worry that the Nord Stream shutdown could force utilities to buy energy at unsustainable prices.
Under the Swedish plan, utilities would be eligible to borrow from $23 billion in guarantees through banks to help cover the costs.
The Finnish government plans to offer $10 billion in guarantees.
“This threatens our financial stability. If we don’t act soon it could lead to serious disruptions in the Nordics and Baltics,“ Swedish Prime Minister Magdalena Andersson said Saturday at a news conference. “In the worst-case scenario we could fall into a financial crisis.”
EU to hold emergency meeting:
European energy ministers are set to hold an emergency meeting on Friday to discuss options to deal with skyrocketing energy costs.
The European Union over the weekend opened the door to imposing price caps on energy.
The EU is also expected to discuss ways to lower the burden on energy companies and try to shield consumers from skyrocketing costs ahead of the winter.