Monday, July 25, 2022

Putin Raises The Stakes: Gazprom Halts Another Nord Stream Turbine Cutting Flows by 50%; European Gas Prices Soar

 

EU leaders, and especially Germans, heaved a sigh of relief on Thursday 22 July  when after two weeks of being beset by fears that Moscow would not restart flows along the Nord Stream 1 pipeline when its 10 day scheduled maintenance operation was completed, the Russian gas company turned the gas back on, although only to its pre-maintenance level of about 40% of maximum capacity.

Their relief did not last however, as the USA, lead military power in NATO continued to supply Ukraine with long range artillery for its war with Russia. Germany the EU's largest economy by far and the most dependent of all NATO states on imported Russian gas to keep its electricity generating plants running and power flowing to business and domestic users was always a soft target for Russian reprisals. Many commentators in mainstream and new media had been speculating that Russia might seize opportunity to turn the screws on both literally and metaphorically,  on Germany and its other EU customer sand that's precisely what happened. Shortly after Siemens finally delivered transport documents for the controversial Nord Stream turbine that had allegedly been stuck in Canada for weeks, Gazprom unexpectedly announced it would halt one more Nord Stream turbine at its Portovaya compressor station from July 27, “taking into account the technical conditions of the engine,” the Russian company says in a statement.

This means that as had been whispered much of last week, gas flows from Portovaya will drop to as much as 33 million cubic meters per day from 7am Moscow time on July 27, which means flows along NS1 will decline by half, from 40% of capacity to just 20%.

This is a disaster both economically and socially for Germany, where some communities have already had to introduce gas and electricity rationing. If the situation goes on for more than two or at most three weeks it will certainly drive the Germany economy into recession.

According to Bloomberg energy expert Javier Blas, with "Nord Stream 1 flowing at just 20% of capacity from July 27, Germany will NOT have enough natural gas to make it throughout the whole winter **unless big demand reductions are implemented. Berlin will need to activate stage 3 of its gas emergency program."

Translation: unless Putin changes his mind, Germany is facing not just a freezing winter, but a bitter recession.

Needless to say, Germany was not happy with the latest reminder who holds all the cards in Europe. Unfortunately the single word that defines the USA's Biden administration is 'demented' and having committed to supporting Ukraine until the war is won the senile president's handlers are unlikely to bite the bullet and admit that Ukraine cannot defeat Russia for the sake of helping a loyal ally like Germany.

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