MOSCOW, 16 Sep — PRIME. German carmaker Volkswagen AG could earn €400 million by reselling back to the German market the gas it bought in 2020, Bloomberg reports, citing a relevant document and its own calculations.
“Europe’s largest automaker will sell gas contracts for 2.6 terawatt-hours (253 million cubic meters – ed.),” the agency said, referring to the document.
“Volkswagen AG… is offloading a massive gas hedge by selling large amounts of the fuel it previously bought back to the German market… Gas prices are now many times higher than when VW purchased gas due to the unprecedented energy crisis in Europe. Based on latest prices, VW could make about 400 million euros ($399 million) in profits.
The agency clarifies that, according to sources, the company planned to use gas next year at its two power plants in Wolfsburg as part of the transition from coal. However, skyrocketing prices, combined with economic and political pressure to conserve fuel, forced Volkswagen to sell it and continue using coal.
The sources also said that the gas was purchased in 2020 through the supplier Wingas GmbH, when the market price was about 30 euros per megawatt-hour ($330-350 per thousand cubic meters), and the profit from the sale of gas will be used to offset the costs associated with using coal or oil, and replacing or upgrading equipment.
Volkswagen Aktiengesellschaft (AG) is a German automotive concern headquartered in Wolfsburg, one of the world’s leading and largest European automakers.