Gazprom delays its gas deliveries to Germany

Correspondent in Berlin



By this week, Russia had agreed significantly more gas delivery to Germany, to meet the growing demand, but yesterday Monday, the day scheduled for delivery, nothing arrived. The entry points of two of the three Russian gas pipelines reaching Germany remained, in fact, inactive. This morning the first movements are registered, but the gas that arrives is insufficient. Gazprom supplies a third of the gas that Europe consumes and it is driving up prices, in a context of the energy crisis that is hitting the continent and threatens to hamper recovery of the region, increase the costs of companies and consumers, in addition to triggering inflation.

In Mallnow, Brandenburg, on the border with Poland, where

The Yamal gas pipeline arrives from Siberia, the suction mechanisms have been switched off for the last fifteen days, as confirmed by the network operator Gascade, and they only move this morning to receive around six million cubic meters of natural gas. Tom Marzec-Manser, chief gas strategist at ISIC analysis company, complains that “it is surprising how small the transported volumes are.” Russian gas also enters Germany through the Transgas pipeline, further south, which runs through Ukraine, Slovakia and the Czech Republic to Germany, but at the Bavarian-Czech entry point at Waidhaus “only ten million cubic meters have been received. », Acknowledges a spokeswoman for the operator Open Grid Europe, “Flows are still too low.” For reference, the Federal Republic of Germany consumes around 300 million cubic meters of natural gas on an average day in November, and Western Europe a total of more than 1.4 billion cubic meters.

Yamal and Transgas they are two of the three main gas pipelines through which Russia sends gas to Germany; the third is Nord Stream 1, the first gas pipeline across the Baltic Sea, through which Moscow supplies gas to Europe, pending the operation of the recently completed and controversial pipeline Nord Stream 2. Deliveries from Yamal and Transgas have fallen sharply since the beginning of October, despite prices in European wholesale trade being higher than they have been in a long time. Gazprom fulfills its contractual obligations, but only to a minimum and with delay. Levels in storage facilities operated by Gazprom companies in Central Europe are much lower than usual at this time of year. This suspicious supply drop is interpreted by some analysts as a Kremlin strategy to deliberately withhold deliveries and thus arouse fears of a bottleneck, thus forcing licenses that have not yet been issued and that prevent Nord Stream 2 from going live.

Last week, Vladimir Putin, promised the West that he would deliver more gas again and, in a televised cabinet meeting, asked Gazprom boss Alexej Miller to start using Gazprom’s storage facilities in Austria “After gas injection into underground storage facilities in Russia is completed, on November 8 or November 9” Yesterday, Monday, a Putin spokesman declared that Gazprom will deliver a part of the agreed mandatory amounts “after November 8”, although without specifying the amounts. And what has begun to arrive is insufficient. Nervousness grows in the market: The wholesale price of gas had increased by around 6% yesterday in the Dutch reference market TTF and the first million liters have led to a 3% drop this morning. In any case, fuel has reached a price more than 20 times higher than at the beginning of the summer of 2020.

Gazprom has posted on Twitter that it is now filling its own gas storage facilities in Europe, by way of explanation for the delays. In total, there are five underground storage facilities, but the group has not specified which ones it is referring to. Furthermore, it remains unclear whether Gazprom will maintain, increase or decrease the supply in the coming days, while analysts point out that the company is willing to continue letting prices rise. “Gazprom has increased its full-year gas price forecasts for exports to Europe and Turkey to a range of $ 295 to $ 330 per 1,000 cubic meters”says Ildar Davletshin, Russia’s head of research for Wood & Co. Mitch Jennings, principal analyst at Moscow-based Sova Capital, points out that Gazprom maintains a conservative estimate of supplies for the whole year, around the 183,000 million cubic meters.

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