Russia shuts off (Majorly) Germany's gas supply

Now it's clear: The supply of Russian gas to Germany via the Nord Stream 1 pipeline was cut off early Wednesday morning. According to the Nord Stream AG Web site, no significant amount of gas originated after three o'clock in the morning.

According to Gazprom, the only remaining turbine at the Portovaya compressor station, which is on the top of the pipeline, needs maintenance. The head of the Federal Network Agency, Klaus Müller, on the other hand, considers this work technically unintelligible. Russia earlier claimed that the necessary turbines were missing, while German authorities have announced that turbines have long been secured. Recently, only about 20 per cent of the maximum amount has gone through the pipeline. Even the federal government doubts the sincerity of Russian authorities, which with this explanation can completely close the flow of gas to Nord Stream 1.

Will the pipelines reopen?

Kremlin spokesman Dmitry Peskov reiterated on Tuesday that Russia is a reliable and willing supplier to meet its obligations. He justified the current disruptions of the technical supply that the West caused itself through its sanctions. He denied having any political background as a trigger for this step. According to Russian claims, the gas will begin to switch through pipelines from September 3rd.

After the final closure for maintenance in July, Gazprom resumed sending gas. Independent internet media The Bell explained the Kremlin is not flexible with threats. In the event of the gas ban, Russia has no potential for threats against Germany. In addition, full isolation from the European market would seriously damage the Russian budget.

Moscow is currently in a comfortable position because it benefits more from exports financially, despite lower shipping volumes, due to high gas prices in the market. According to its statements, the state-controlled Russian gas company Gazprom made record profits in the first half of the year, despite Western sanctions due to the war in Ukraine. The Russian side announced on Tuesday that the company has scored a positive score of 2.5 trillion rubles (which is about 41.6 billion euros).

Another reason to talk about the resumption of gas deliveries, at least to a limited extent, is that Gazprom would be forced to fire and ensure the preservation of production capacities. A large - scale orientation of Russian gas flows to Asia is not possible, since the pipeline system in this direction is not good. Of the 720 billion cubic metres Russia produces, 200 are exported, 130 go to EU countries. China, on the other hand, is buying only ten billion cubic metres, although sales in this direction are increasing. This is one of the reasons Russia is being forced to turn on the remaining amounts of gas it cannot send to Europe.

Gazprom has not specified whether, in the future, there will be gas bans on Germany. But reportedly the last remaining turbine at the Portovaya station should be repaired every 1,000 hours of work, meaning that the next technical control will be in mid-October.

What does that mean for Germany?

The storage operators say Germany will be able to accumulate gas even without Russian gas. Energy storage industry association INES and other authorities suggest that, meanwhile, over 83% of German tanks are filled with gas. Soon this figure will pass 85 %s as scheduled to be reached by October 1st. For a relatively calm winter, however, more than 95% of the reserves are expected by November 1st. The Society calls this a target “fixing”. The “will be a little harder to achieve this goal if Nord Stream 11” closes, says Association Manager Sebastian Bleschke.

Prices

Gas market expert Heiko Lohmann does not expect maintenance work to have a major impact on prices. When technical works were announced, gas prices increased. So these awards are now calculated. The question is what will happen after three days”, Lohmann says. He expects prices to rise if Russian gas deliveries stop eventually. On the other hand, you see the possibility of lowering prices if remittances continue.

Otherwise, in May the pipeline worked almost normally. Since June, the reduction in gas volume has been gradually submitted. On June 17th, only 40 per cent of maximum capacity has been submitted. While after the work done on the pipeline in July, the amount of gas sent was 40 per cent for several days. And after July 28th, it has dropped to about 20 per cent.

What do the contracts predict?

Companies don't like using the word <x0-scalm contracts”. As the biggest German importor of Russian natural gas, the Unipper company recently reported: “since June 14th, Unipper has received only part of the contractual gas supply volumes from Russia.” While currently sending 80 per cent less gas than the amount contracted. The Federal Economy Ministry reports that <x4-company companies have contracts with Gazprom for full capacity, which are currently being respected only to a limited extent. From our point of view, there is no reason, nor technically, to use Nord Stream 1 at a higher capacity. ”

Turbine Problems

In the past, Russia has mentioned a turbine that should come from Canada as a trigger for reducing gas quantities. Germany asked the government in Ottawa for an exception to sanctions against Moscow, which it agreed to. Turbina has arrived at Mülheim, but Gazprom did not rush to install it and spoke of lack of documents. Hence, the German federal government accused Moscow of using this turbine only as justification. /dw