A train passes in front of the oil depots of the NNK-Primornefteproduct oil depot in the eastern port of Vladivostok, Russia, on June 11, 2022. REUTERS / Tatiana Meel
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- Nord Stream 1 pipeline capacity up to 40%
- The price of gas in Europe rises to 30% after news of outages
- Gazprom attributes the cuts to equipment delays in Canada
- Germany says gas cuts are aimed at raising prices even further
LONDON, June 16 (Reuters) – Russian gas supplies to Europe via the Nord Stream 1 pipeline fell even further on Thursday, and Moscow said further delays in repairs could lead to the suspension of all flows, slowing the European race to replenish their gas inventories.
The blasts come as leaders in Germany, Italy and France visit Ukraine, which is calling for a faster delivery of weapons to fight Russian invading forces and is calling for support for Kyiv’s proposal to join the European Union. Read more
Russia-controlled Gazprom said on Thursday it was reducing supplies for the second time in as many days via North Stream 1, which passes below the Baltic to Germany. The latest measure cuts supply to just 40% of pipeline capacity.
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He said cuts were needed due to the delay in returning equipment sent to Canada for maintenance, an explanation the German regulator said was technically “unfounded”. The German government said Russia wanted to raise gas prices. Read more
Kremlin spokesman Dmitry Peskov said on Thursday that supply cuts were not premeditated and reiterated that the outages were caused by maintenance problems.
Dutch wholesale gas prices, the European benchmark, rose to 30% on Thursday morning.
Russia’s ambassador to the European Union told state news agency RIA Novosti that flows through the pipeline could be suspended due to problems with turbine repair in Canada.
Nord Stream 1 has the capacity to pump about 55 billion cubic meters (bcm) a year into the European Union, which last year imported about 140 bcm of gas from Russia through pipelines.
Germany, like other European countries, is struggling to refill its gas storage facilities to be 80% full in October and 90% in November before winter arrives. The shops are 56% full now.
Cutting flows through Nord Stream 1 would make this task more difficult, said the head of the German energy regulator.
“Maybe we could spend the summer when the heating season is over. But it’s essential that we fill the storage facilities to spend the winter,” Klaus Mueller told Rheinische Post on Thursday. .
EUROPEAN RACES TO FILL STORAGE
Uniper (UN01.DE), Germany’s largest importer of Russian gas, said supplies were down a quarter of the agreed volumes, but could fill missing volumes from other sources. Energy producer RWE (RWEG.DE) said it had seen restrictions over the past two days.
The European Union aims to ensure that the gas storage facilities of the 27-nation bloc are 80% full by November. But other European nations are also facing falling Russian supplies. Read more
Slovakia’s state-owned gas importer SPP said it expected gas deliveries to Russia to fall by about 30%, while Czech power company CEZ (CEZP.PR) said it had experienced a drop. similar, but that it was filling the void of other sources.
The Austrian OMV (OMVV.VI) said that Gazprom had informed it of the reduction in deliveries and the French Engie (ENGIE.PA) said that flows had fallen but that customers were not affected. Flows to Italy also fell.
In addition to the challenge, Nord Stream 1 will close completely during the annual maintenance of the pipeline from 11 to 21 July.
Norway, Europe’s second-largest exporter after Russia, has increased production to help the European Union reach its goal of ending dependence on Russian fossil fuels by 2027.
Britain’s Centrica (CNA.L) has signed an agreement with Norway’s Equinor (EQNR.OL) for additional gas supplies to the UK over the next three winters. Britain does not depend on Russian gas and can also export to Europe through gas pipelines.
European states have also increased imports of liquefied natural gas (LNG), but Europe has a limited capacity to import LNG and the already restricted LNG market has faced additional challenges with disruptions in LNG production. of the USA. Read more
A fire last week at a U.S. LNG export plant in Texas, operated by Freeport LNG, means the plant will be offline until September and will only partially operate from then until the end of 2022.
The facility, which accounts for about 20% of U.S. LNG exports, has been a major supplier to European buyers.
“In our view, there is a risk of further delays,” said investment bank analysts Jefferies, who added that regulators must approve the restart while there are two ongoing investigations into the cause of the LNG leak to the plant.
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Report by Alexandra Schwarz-Goerlich in Vienna, Jan Lopatka in Prague, Madelaine Chambers in Berlin, Nina Chestney in London; Written by Nina Chestney; Editing by Jason Neely and Edmund Blair
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