Image Source: Energy Connects
After the Russian state-controlled gas giant Gazprom cut its supply to Germany in half, the company’s CEO stated it was a case of “our product, our regulations.”
Germany’s economy minister has accused Gazprom of seeking to drive up energy prices by drastically cutting supplies. However, Gazprom claimed that it was due to the delayed return of equipment serviced in Canada by Germany’s Siemens Energy.
Russia’s gas supply has also dropped dramatically in Italy and Austria. This, according to the Kremlin, was not planned. After reducing the amount of gas sent to Germany to under 70 million cubic meters per day – less than half the present pace – Gazprom CEO Alexei Miller said Russia will play by its own rules.
He claimed he didn’t see a way to fix the compressor station at Portovaya, which is part of the Nord Stream 1 pipeline that transports Russian gas to Germany. In addition, Mr. Miller said penalties prevented equipment from being returned, a charge Germany described as “unfounded.”
Meanwhile, due to the problems at Portovaya, Eni, the Italian energy giant, said it would only receive 65 percent of the gas sought from Gazprom on Thursday.
However, if Russia’s gas supply cuts persist in the next few days, the Italian government has prepared all necessary countermeasures, according to the country’s ecological transition minister.
According to Gazprom, gas flow through the Nordstream 1 pipeline to Germany has been reduced to 40% of its normal capacity. Robert Habeck, the economy and climate change minister, is the least of them. He said that this was a political choice. It was possibly taken to coincide with Chancellor Olaf Scholz’s visit to Ukraine (Gazprom announced on Tuesday that it would decrease the delivery, then announced a further reduction on Wednesday).
The Federal Network Agency president, who is in charge of Germany’s electricity infrastructure, called it a “warning sign.” According to Klaus Mueller, Russia is attempting to sow unrest and raise gas prices.
According to the administration, the government has advised citizens and businesses to save energy, but there is currently no lack of supplies. There’s no need to be alarmed; after all, it’s summer, and most newspapers are reporting on an oncoming heat wave this weekend. Nonetheless, the organization warns that Germany will face a crisis if the lower gas supply continues. Before the winter, reservoirs must be refilled. And there’s no doubt that Berlin is concerned about the move.
Germany is still significantly reliant on Russian gas. While it’s likely that Vladimir Putin won’t want to go without the money, Mr. Mueller said the potential of a supply suspension couldn’t be ruled out.
The presentational grey line of 2px On Wednesday and Thursday, European energy businesses like ENI in Italy, OMV in Austria, and Uniper in Germany reported major drops in Russian gas supplies. According to ENI, Gazprom cut its gas supply to Italy by around 15% on Wednesday. Italy, like Germany, is significantly reliant on Russian gas, with 40 percent of its imports coming from Russia.
After refusing a demand that “unfriendly countries” pay in Russian rubles, Russian natural gas supply to Poland, Bulgaria, Finland, Denmark, and the Netherlands was already halted. The payment demand was interpreted as an attempt by Russia to bolster the rouble after it was battered by Western sanctions. Demand for rubles is projected to rise as foreign exchange demand rises, pushing up the currency’s value.
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