MOSCOW: A major gas pipeline from Russia to Europe was shut down on Wednesday, sparking economic conflict between Moscow and Brussels and raising the prospect of a recession and energy rationing in some of the region's richest countries.
According to Russian state energy giant Gazprom, no gas will flow into Germany until 01:00 GMT on 3 September due to a Nord Stream 1 maintenance outage.
Russian President Vladimir Putin has been accused of using energy supplies by European governments as "weapons of war" and is concerned that Moscow will prolong the blackout in retaliation for the sanctions imposed on Ukraine by the West. can pull.
Additional restrictions on European gas imports would exacerbate an energy shortage, resulting in a more than 400% increase in wholesale gas prices since last August, plunging consumers and businesses into a painful cost-of-life crisis and Governments have been forced to spend billions.
Inflation in Germany hit its highest level in nearly 50 years in August, and consumer confidence is expected to hit a record low next month as households prepare for higher energy costs.
The upcoming work, which will focus on the station's final operational turbines, was announced less than two weeks ago and will be carried out by Gazprom instead of Nord Stream AG, in contrast to last month's 10-day maintenance for Nord Stream AG.
Moscow, which reduced supply through the Nord Stream by 1 to 40% of capacity in June and 20% in July, attributes the reduction in maintenance problems and restrictions, which it claims should reduce equipment return and installation.
The most recent shutdown, according to Gazprom, necessitated maintenance on the only remaining compressor in the pipeline. However, since the beginning of what Moscow refers to as its "special military operation" in Ukraine, Russia has completely cut off supplies to Bulgaria, Denmark, Finland, the Netherlands and Poland and reduced flow through other pipelines.
Regarding a separate dispute over payments, the Energy Minister in Paris claimed that Gazprom was only using the situation as an excuse to stop natural gas delivery to its French contractor, but also said that France had suffered a loss of supply. had predicted.
To replace Russian gas imports by mid-2024, German Economy Minister Robert Hebeck said earlier this month that the Nord Stream was "fully operational" and had no technical problems, despite Moscow's claims to the contrary.
According to Claus Müller, president of Germany's network regulator, the resumption of flows will improve the security of Germany's supply, but no one can predict what the effects will be if flows remain at zero.
Europe's biggest economy is filling up its gas storage facilities faster than expected, but it still won't be enough to get the country through the winter, he said.
To survive the winter, when governments worry that Russia may shut off gas flow altogether, the low flow through the Nord Stream has made it more challenging to fill needed gas storage facilities.
To save money, while businesses prepare for potential rationing, some Europeans are voluntarily reducing their energy consumption. Examples include limiting the use of electrical appliances and taking showers at work.
With a target of 85% for its national gas storage tanks already within reach by October 1, Germany has warned that achieving 95% by November 1 will be challenging unless businesses and households make a significant reduction in consumption.
The current storage level for the entire EU is 79.94%, just short of the 80% target by 1 October, when the continent's warming season begins.
Analysts at Goldman Sachs said they believe this outage will not last.
If this happened, he claimed, "there would be no more surprise elements and lower revenues, while reduced (Nord Stream 1) inflows and the occasional drop to zero have the potential to sustain market volatility and political pressure on Europe higher.
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