‘Our product, our rules’: Russia sounds alarm over Europe’s winter gas supplies

Gazprom’s Miller says he sees no solution to an ongoing equipment problem on part of the Nord Stream 1 pipeline.

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LONDON — An ominous warning from Russian energy giant Gazprom has fueled fears of another choppy winter for European gas supplies.

As a pre-summer heat wave hits Western Europe this week, policymakers in the region are scrambling to fill underground storage with natural gas to provide households with enough fuel to keep the lights on. lit and the houses warm before the cold weather returns.

Fears of a severe winter gas shortage are driven by the risk of a total supply disruption to the EU – which receives around 40% of its gas via Russian pipelines. The bloc is trying to quickly reduce its dependence on Russian hydrocarbons in response to the nearly four-month-long assault on the Kremlin in Ukraine.

Many worry about the reliability of Russian gas flows to Europe as the conflict continues and economic sanctions weigh in. Indeed, Moscow has already cut gas supplies to Finland, Poland, Bulgaria, Denmark’s Orsted, Dutch company Gasterra and energy giant Shell for its German contracts, as part of a dispute over the payment of gas for rubles.

More recently, the Russian Gazprom chose to further limit supplies via the Nord Stream 1 gas pipeline which leaves from Russia to Germany under the Baltic Sea, and reduced flows to Italy.

Gazprom on Wednesday cited a technical problem for the supply cut, saying the problem stemmed from the delayed return of equipment maintained by German Siemens Energy to Canada. Austria and Slovakia also reported reductions in supply from Russia.

Moreover, in fiery comments likely to have raised alarm bells across the bloc, Gazprom CEO Alexei Miller said on Thursday that Russia would play by its own rules after the company halved deliveries to Germany.

“Our product, our rules. We don’t play by rules we didn’t create,” Miller said during a panel discussion at the St. Petersburg International Economic Forum, according to the Moscow Times.

Miller reportedly said the return of equipment from the Portovaya compressor station – part of the Nord Stream 1 pipeline that carries Russian gas to Germany – had been hampered by an unprecedented barrage of economic sanctions. He added that he saw no solution to the problem.

Flow control valves at a natural gas metering station in Moldova.

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German Economy Minister Robert Habeck dismissed claims that Western sanctions were to blame and called Russia’s supply restrictions a ‘political decision’ aimed at disrupting the region and driving up prices some gas.

Wholesale prices for Dutch gas, a European benchmark for natural gas trading, jumped as much as 9% in Friday morning trading, before paring gains.

Energy rationing warning

The latest dispute appears to reaffirm the risk to European countries heavily dependent on Russian gas, particularly amid growing fears that Moscow could implement a wider supply squeeze in the coming months.

Underscoring the seriousness of these concerns, IEA Director General Faith Birol warned last week that EU countries could be at risk of winter energy rationing if member states do not take more action to improve energy consumption. ‘energetic efficiency.

The European Commission, the executive arm of the EU, said on Friday it was aware of announcements by Gazprom that it would reduce flows via Nord Stream 1 as well as deliveries to several businesses across the EU.

A spokesperson for the bloc described the move as “another example of Gazprom and Russia using its energy supplies as an instrument of blackmail.”

“Based on our exchange with national authorities yesterday via the Gas Coordination Group, there is no indication of an immediate risk to security of supply, but we will continue to monitor the situation very closely. and will remain in contact with the national authorities of the countries concerned,” they added.

It is not yet known when or if Nord Stream 1 gas flows will return to normal levels.

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