Gazprom’s Miller says he sees no solution to an ongoing equipment problem on part of the Nord Stream 1 pipeline.
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LONDON – An ominous warning from Russia’s state-backed energy giant Gazprom has stoked fears of another turbulent winter for Europe’s gas supplies.
As a pre-summer heatwave hits western Europe this week, policymakers across the region are scrambling to stockpile underground storage with natural gas to provide households with enough fuel to keep lights on and homes warm before the cold returns.
Fears of a severe winter gas shortage are being driven by the risk of a complete disruption in supplies to the EU, which gets about 40% of its gas through Russian pipelines. The bloc is seeking to rapidly reduce its reliance on Russian hydrocarbons in response to the Kremlin’s nearly four-month long attack in Ukraine.
Many worry about the reliability of Russian gas flows to Europe as the conflict rages and economic sanctions take hold. Indeed, Moscow has already halted gas supplies to Finland, Poland, Bulgaria, Denmark’s Orsted, Dutch company Gasterra and energy giant Shell for its German contracts over a gas-for-ruble payment dispute.
Recently, Russia’s Gazprom decided to further restrict supplies via the Nord Stream 1 pipeline, which runs from Russia to Germany under the Baltic Sea, and to reduce supplies to Italy.
Gazprom on Wednesday cited a technical issue for the supply cut, saying the problem stems from the late return of equipment serviced by Germany’s Siemens Energy in Canada. Austria and Slovakia have also reported supply cuts from Russia.
Additionally, Gazprom CEO Alexei Miller said Thursday that Russia will play by its own rules after the company halved supplies to Germany, in fiery comments likely to set off alarm bells across the bloc.
“Our product, our rules. We don’t play by rules we didn’t create,” Miller said during a panel session at the St. Petersburg International Economic Forum, according to The Moscow Times.
Miller reportedly said the return of equipment from the Portovaya compressor station — part of the Nord Stream 1 pipeline that carries Russian gas to Germany — has been hampered by an unprecedented spate of economic sanctions. He added that he didn’t see a solution to the problem.
Flow control valves at a natural gas metering station in Moldova.
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German Economy Minister Robert Habeck has dismissed claims that Western sanctions were to blame, calling Russia’s supply restrictions a “political decision” intended to unsettle the region and drive up gas prices.
Dutch wholesale gas prices, a European benchmark for natural gas trading, rose as much as 9% during Friday morning trading before bouncing back.
Energy rationing warning
The latest row seems to reaffirm the risk for European countries heavily dependent on Russian gas, especially amid growing fears that Moscow could impose a broader supply crunch in the coming months.
Faith Birol, chief executive of the IEA, underscored the seriousness of these concerns and warned last week that EU countries could face winter energy rationing unless member states take further steps to improve energy efficiency.
The European Commission, the EU’s executive arm, said on Friday it was aware of Gazprom’s announcement that it would reduce flows via Nord Stream 1, as well as supplies to several companies across the EU.
A spokesman for the bloc called the move “another example of Gazprom and Russia using its energy supplies as a tool of blackmail.”
“Based on our exchanges with national authorities yesterday via the Gas Coordination Group, there is no indication of an immediate risk to security of supply, but we will continue to monitor the situation very closely and remain in touch with the national authorities of the countries concerned. ‘ they added.
It is not yet known when or if Nord Stream 1 gas flows will return to normal levels.