MOSCOW, July 25 (Reuters) – Russia tightened its gas squeeze on Europe on Monday as Gazprom (GAZP.MM) stated provides by means of the Nord Stream 1 pipeline to Germany would drop to simply 20% of capability.
Gazprom stated flows would fall to 33 million cubic metres per day from 0400 GMT on Wednesday – a halving of the present, already diminished stage – as a result of it wanted to halt the operation of a Siemens gas turbine at a compressor station on directions from an trade watchdog.
Germany stated it noticed no technical cause for the newest discount, which comes as Russia and the West change financial blows in response to what Moscow calls its particular army operation in Ukraine.
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The Dutch front-month gas contract, the European benchmark, closed 9.95% greater on information of the newest blow to Nord Stream 1. The pipeline, which has a capability of 55 billion cubic metres a 12 months, is the only largest Russian gas hyperlink to Europe.
The European Union has repeatedly accused Russia of resorting to vitality blackmail, whereas the Kremlin says the shortfalls have been attributable to upkeep points and the impact of Western sanctions.
Politicians in Europe have stated Russia might reduce off gas flows this winter, which might thrust Germany into recession and lead to hovering costs for customers already grappling with greater costs for meals and vitality.
Germany was pressured final week to announce a $15 billion bailout of Uniper (UN01.DE), its largest firm importing gas from Russia. learn extra
PUTIN WARNING
President Vladimir Putin had foreshadowed the newest reduce, warning the West this month that continued sanctions risked triggering catastrophic vitality worth rises for customers all over the world. learn extra
Russia had already reduce flows by means of Nord Stream 1 to 40% of capability in June, citing the delayed return of a turbine that was being serviced by Siemens Energy (ENR1n.DE) in Canada – a proof that Germany rejected as spurious.
It then shut Nord Stream 1 altogether for 10 days of annual upkeep this month, restarting it final Thursday nonetheless at 40% of regular ranges.
The servicing of that first turbine continues to be a matter of dispute because it makes its means again to Russia by means of a tangle of paperwork and conflicting statements.
Gazprom stated on Monday it had acquired paperwork from Siemens Energy (ENR1n.DE) and Canada however “they do not remove the previously identified risks and raise additional questions”.
It stated there have been additionally nonetheless questions over EU and UK sanctions, “the resolution of which is important for the delivery of the engine to Russia and the urgent overhaul of other gas turbine engines for the Portovaya compressor station.”
Siemens Energy stated the transport of the serviced turbine to Russia might begin instantly, and the ball was in Gazprom’s courtroom.
“The German authorities provided Siemens Energy with all the necessary documents for the export of the turbine to Russia at the beginning of last week. Gazprom is aware of this,” it stated.
“What is missing, however, are the customs documents for import to Russia. Gazprom, as the customer, is required to provide those.”
The German firm stated it noticed no hyperlink between the turbine difficulty and the gas cuts applied or introduced by Gazprom. Gazprom didn’t instantly reply to a request for remark.
The Kremlin stated earlier that Moscow was not desirous about a whole stoppage of Russian gas provides to Europe, which is straining to fill its underground storage earlier than the height demand winter season.
The disruption has raised the danger of gas rationing on the continent, with the European Union proposing to member states final week that they reduce gas use by 15% between August and March in contrast with the identical interval of earlier years.
Russia is the world’s second largest oil exporter after Saudi Arabia and the world’s largest exporter of pure gas. Europe imports about 40% of its gas and 30% of its oil from Russia.
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Reporting by Reuters in Moscow; extra reporting by Nina Chestney, Marwa Awad and Christoph Steitz; writing by Mark Trevelyan, modifying by Guy Faulconbridge, Barbara Lewis and Tomasz Janowski
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