Reside information updates from August 19: Gazprom to close fuel movement to Europe, Xi and Putin to attend G20

© Reuters

Gazprom mentioned it could shut down the Nord Stream 1 pipeline, which carries fuel to Europe through the Baltic Sea, in late August, additional decreasing fuel flows to Europe as power costs rise and the continent Scrambles to seek out provides after Russia invades Ukraine.

The Russian state-owned fuel monopoly mentioned on Friday it could shut down the one working compressor station on Nord Stream 1 in Portovaya, close to St Petersburg, from August 31 to September 2.

Gazprom mentioned it could then resume supplying 33 million cubic meters of fuel per day to Europe, about 20 p.c of NS1’s capability, or roughly the identical quantity provided through the pipeline to Germany in latest weeks.

Russia’s state-backed fuel monopoly reduce capability on the road for the primary time in June. Gasoline costs in Europe have greater than doubled since then and closed greater than 6 p.c on Friday at €256 per megawatt hour, the best closing value on report.

Gazprom can ship as a lot as 167mn cubic meters per day by way of the pipeline, however has reduce provides in latest months over the restrictions. The corporate has claimed that it’s unable to provide common portions of fuel attributable to delays in restore and return of generators manufactured by Germany’s Siemens Vitality.

European leaders and power corporations have mentioned there isn’t any technical downside stopping Gazprom from supplying extra fuel and declare Russia is intentionally limiting provides for political causes.

Gazprom mentioned in an announcement that the restore was necessary below the contract with Siemens Vitality and that specialists from the German firm would take part within the restore.

Siemens Vitality declined to remark.

“It is a vivid instance of Putin’s hybrid power battle in opposition to the European Union,” mentioned Sergei Makogon, chief government of Ukraine’s state-owned fuel transmission community. “Ukraine and Poland have passive transit capability, which can be utilized to totally compensate for the movement by way of Nord Stream 1,” he continued.

Yuri Vitrenko, CEO of Ukraine’s state fuel firm Naftogaz, mentioned there may be “no indication that Gazprom will compensate” by pumping extra fuel by way of Ukraine’s huge fuel transport pipeline, a significant route for provide to European markets.

“The purpose could also be to strain Germany to ease and even permit sanctions” [Nord Stream 2]to launch, Vitrenko mentioned.

“The prospect of Gazprom closing Nord Stream 1 for 3 days is simply going to shake the market,” mentioned ICIS analyst Tom Marjek-Manser. “Gasoline costs jumped on the finish of the buying and selling day as a upkeep announcement and will simply rise additional on Monday as consumers assess whether or not they really consider the pipe will probably be again in service because the Russian provider mentioned. mentioned.”

Further reporting by Roman Olerchik in Kyiv, Martin Arnold in Frankfurt and David Shepard in London

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