Prices soar as Russian supply concerns mount

March 2 (Reuters) - British and Dutch gas prices soared over 30% on Wednesday morning, driven by anxiety over the continued supply of Russian gas and possible sanctions in response to the invasion of Ukraine.

The British day-ahead gas price < TRGBNBPD1> rose 85 pence to 380 p/therm by 1052 GMT.

The April contract jumped 68.50 pence to 360 pence/therm.

The Dutch front-month contract rose by 35.70 euros to 158.60 euros/MWh, and earlier hit a fresh all-time high of 185 euros/MWh.

The key driver was a risk of supply cuts from Russia, market observers agreed.

"The highly unpredictable geopolitical situation and risk for further escalation and new sanctions are likely to support prices further," analysts at Refinitiv said in a morning report.

News that the EU is considering banning Russian ships from ports should also provide strong sentiment, they added.

Britain ordered a block of its port to Russian-associated vessels on Monday, a move that may be copied by the European Union.

Several tankers originating from Russia's Yamal LNG facility that initially signalled destinations in the UK and France have changed their status to "For Orders", Refinitiv Eikon ship-tracking data showed.

However, pipeline supplies of natural gas from Russia to Europe increased in the past days, Bjarne Schieldrop, chief commodities analyst at SEB bank said in a note.

"We don't know if it is sustainable or why this is happening," Schieldrop said, but added the risk of damage to oil and gas pipelines in Ukraine due to the ongoing war is still high.

Capacity nominations for Russian gas supply to Slovakia from Ukraine via the Velke Kapusany border point, were expected to hit their highest level so far in 2022, at 881,917 megawatt hours (MWh) on Wednesday, while deliveries through Poland on the Yamal-Europe pipeline continued to flip between east- and westbound flows.

Meanwhile, the European Union benchmark carbon price continued to post sharp losses, and was down 4.66 euros at 64.19 euros a tonne.

An auction of Polish allowances had to be cancelled due to a lack of interest.