Jun 17, 2022 Today, Gazprom announced a further cut in exports of gas via Nord Stream 1 to Germany and on into Europe. Earlier this week, they had cut 40%, now it is 60% of the 55 billion cubic meters per year (bcm) that normally flows in this pipe.
I explained that the Gazprom excuse – -that it could not re-import some compressor parts it had sent to Siemens to repair in Canada due to sanctions — appears as a convenient, manufactured excuse.
I pointed out that a one-off sanctions waiver from the USA, EU and/or Canada for the reimportation of these very specific parts could likely be easily arranged – and if the gas did not again flow fully, Gazprom’s ruse would be clearly exposed.
However, as I said, this is more accurately understood as simply another step in the weaponization of the over-dependence of the European Union (and esp. of Germany, Austria and Italy) on Russian gas imports, a game which Mr. Putin began in earnest in August of 2021.
From that time, Gazprom had refused to send spot gas (i.e., non-long-term-contracted flows) into Europe at a time when Europe’s storage of gas was critically low from the previous harsh winter of 2020-21. This set the stage for a crisis last winter of 2021-22. However, the EU lucked out, as the winter was not so harsh.
Then, as listeners may recall, after the invasion of Ukraine on 23 February of this year, energy sanctions were put by the USA and the EU on Russian foreign exchange and on its use of the SWIFT bank transfer system; while both the USA and EU began to decrease purchases of Russian oil and gas.
In reaction, Putin and Gazprom began insisting in March and April this year that Russian gas deliveries to Europe be paid for in Rubles – which would assist Moscow to partially evade the effects of the banking and foreign exchange sanctions. On the excuse that Poland, Bulgaria and Netherlands refused to pay in Rubles, Gazprom recently cut off their Russian gas imports.
In this light, this latest excuse of a lack of compressor parts has been manufactured as a reason to cut off 60% of Nord Stream 1 pipeline flows to Germany and on into Europe.
I explained that if this continues, the EU will be in dire straits this winter. To illustrate, I explained the results of the 2015 EU gas stress test, ordered by the G7 at the time, just after the 2014 first invasion of Ukraine by Russia. That stress test stressed, in its conclusions, that EU Member states’ mutual “solidarity” would be crucial to avert a gas-shortage crisis during any long term Russian cut off of gas supplies.
What this solidarity would consist of is that countries with extra gas would have to share with the several EU states that are totally or near totally dependent on Russian gas imports. However, in the present situation, where so much Russian gas is being cut off so long before winter arrives, the likely situation will be that no country will have “extra” gas.
What is likely, especially if it is a harsh winter in 2022-23, is that countries with less of a shortage will have to share their gas with countries with almost no gas arriving. This would lead to rationing and shutdowns of especially industries on a schedule dictated by the Member states’ government and/or by Brussels.
This would be a very difficult situation.
I ended by stating that this is indeed a case of the further weaponization by Russia of the EU’s over-dependence on its gas imports – an economic and energy war to accompany its hot war of aggression inside Ukraine. This could be very difficult for Europe indeed. Solidarity – and maximal preparations seeking alternative supplies and switching to other energy sources – will indeed be key to get through it.
by Tom O’Donnell 17jun22, on Al Jazeera, English, London.
The Global Barrel 