Russian Gazprom tightens pressure on gas flows to Europe

  • This content was produced in Russia, where law restricts coverage of Russian military operations in Ukraine.

MOSCOW, July 25 (Reuters) – Russia tightened its gas tightening on Europe on Monday as Gazprom (GAZP.MM) said supplies through the Nord Stream 1 gas pipeline to Germany would fall to just 20% of capacity.

Gazprom said flows would fall to 33 million cubic meters per day from 0400 GMT on Wednesday – a halving of the current, already reduced level – as it had to shut down the operation of a Siemens gas turbine at a gas station. compression on the instructions of an industry watchdog. .

Germany has said it sees no technical reason for the latest cut, which comes as Russia and the West trade economic blows in response to what Moscow calls its special military operation in Ukraine.

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The Dutch first-month gas contract, the European benchmark, closed up 9.95% on the news of the latest blow to Nord Stream 1. The pipeline, with a capacity of 55 billion cubic meters per year, is the largest Russian gas connection to Europe.

The European Union has repeatedly accused Russia of using energy blackmail, while the Kremlin says the shortfalls were caused by maintenance issues and the effect of Western sanctions.

European politicians have said Russia could cut off gas flows this winter, plunging Germany into recession and sending prices soaring for consumers already struggling with higher food and energy prices .

Germany was forced last week to announce a $15 billion bailout of Uniper (UN01.DE)its largest gas importer from Russia. Read more

PUTIN’S WARNING

President Vladimir Putin had announced the latest cut, warning the West this month that continued sanctions risked triggering catastrophic energy price hikes for consumers around the world. Read more

Russia had already cut flows via Nord Stream 1 to 40% capacity in June, citing the delayed return of a turbine that was being serviced by Siemens Energy (REC1n.DE) in Canada – an explanation that Germany dismissed as fallacious.

A view shows pipes at the landing facilities of the ‘Nord Stream 1’ gas pipeline in Lubmin, Germany July 21, 2022. REUTERS/Annegret Hilse/File Photo

It then shut down Nord Stream 1 completely for 10 days of annual maintenance this month, restarting it last Thursday still at 40% of normal levels.

The maintenance of this first turbine is still a matter of dispute as it returns to Russia through a tangle of conflicting documents and statements.

Gazprom said on Monday it had received documents from Siemens Energy (REC1n.DE) and Canada but “they do not remove previously identified risks and raise additional questions”.

He added that there also remained questions about 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 Portovaya Compressor Station”.

Siemens Energy said transport of the serviced turbine to Russia could begin immediately, and the ball was in Gazprom’s court.

“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,” he said.

“What is missing, however, are the customs documents for importing into Russia. Gazprom, as a customer, is obliged to provide them.”

The German company said it sees no connection between the turbine problem and the gas cuts implemented or announced by Gazprom. Gazprom did not immediately respond to a request for comment.

The Kremlin said earlier that Moscow was not interested in a complete shutdown of Russian gas supplies to Europe, which is struggling to fill its underground storage before the peak of the winter season.

The disruption has increased the risk of gas rationing on the continent, with the European Union last week proposing to member states to cut their gas consumption by 15% between August and March compared to the same period in previous years.

Russia is the world’s second largest oil exporter after Saudi Arabia and the world’s largest exporter of natural gas. Europe imports about 40% of its gas and 30% of its oil from Russia.

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Reuters reporting in Moscow; additional reporting by Nina Chestney, Marwa Awad and Christoph Steitz; written by Mark Trevelyan, editing by Guy Faulconbridge, Barbara Lewis and Tomasz Janowski

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