The Nord Stream 1 pipeline stopped accepting supplies on Wednesday as part of what the Russian state energy firm Gazprom claimed was a scheduled closure for maintenance until Saturday.
The Nord Stream 1 pipeline, which travels straight to Germany, the EU's largest economy, is a crucial route for bringing Russia's massive gas resources to the continent. Last year, the pipeline was responsible for nearly 35% of all Russian gas imported into Europe.
Due to maintenance problems and Western technology export prohibitions enacted in reaction to Russia's invasion of Ukraine, Gazprom has recently reduced flows via Nord Stream 1 to barely 20% of capacity.
A number of "hostile" European nations and energy firms have also had their supply shut off by Russia because they refused to pay for gas in rubles, as the Kremlin demands, rather than the euros or dollars specified in the contracts. According to European leaders, Russia is attempting to extort nations for their backing of Ukraine.
Engie (EGIEY) of France is the most recent victim. Due to unpaid invoices from Engie for the gas it delivered in July, Gazprom said on Tuesday that it will stop all deliveries to the firm starting on Thursday.
The shutdown, according to a statement from Engie on Tuesday, was "caused by a difference of opinion between the parties on the application of contracts."
Europe suffers yet another setback from both shutoffs. Since Moscow invaded Ukraine in late February, the price of gas and electricity has skyrocketed, prompting worries that there would be shortages throughout the winter and driving up costs across the economy. This is due to a substantial decline in Moscow's energy exports to the European Union.
According to a preliminary estimate made public on Wednesday by the EU statistics agency, inflation in the 19 countries that use the euro reached 9.1% in August. Since the bloc started keeping records in 1997, that is the highest level.
With a 38% increase in the year to August, energy costs were the single greatest contributor to inflation.
Early on Wednesday, benchmark gas prices in Europe increased by about 6% to reach €284 ($284) per megawatt hour. Since then, however, they have marginally decreased. As the union works to build up its gas reserves in time for winter, prices may rise once further if Nord Stream 1 is shut down after this Saturday or if flows restart at a much lower rate.
Prior to November, nations in the European Union had aimed to fill gas storage facilities to at least 80% of their capacity.
German Chancellor Olaf Scholz stated on Tuesday that his nation is "far better prepared" than "was foreseeable a few months ago" in terms of ensuring gas supplies for this winter.
We are capable of handling the Russian threats that are directed against us, he stated.
However, if Russia chose to quickly stop all exports to Europe, there may not be enough storage to prevent a full-blown energy catastrophe.
The International Energy Agency's executive director, Fatih Birol, issued a warning last month, stating that "the next few months will be important."
"The situation would be far more dire and hard if Russia decides to entirely shut off gas supplies before Europe can bring its storage levels up to 90%," he warned in a statement.
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