Putin says Russia will honor gas commitments to Europe but warns of more turmoil

Russian President

Russian President Vladimir Putin

He said that Russia would fulfill its commitments to supply natural gas to Europe, but warned that flows through Nord Stream pipeline It could soon be curbed if sanctions prevented additional maintenance of its components.

Nord Stream The main artery of Russian gas to Europe, currently shut down due to regular maintenance, and European governments are concerned that the Kremlin will not regain its flow when work ends on Thursday. prolonged break It may push governments to rationalize energyIt hurts industry and hurts already fragile economic growth.

In comments late Tuesday after his visit to Tehran, Putin said Gazprom SAOG, the Kremlin-controlled energy source, the pipeline’s largest shareholder, “has always fulfilled and will fulfill all its obligations.”

But the Russian president added that flows could drop to around 20% of capacity as soon as next week if the turbine of a pipeline that was undergoing repairs in Canada was not returned to Russia soon. Putin said another turbine should go for maintenance on July 26.

The comments are in line with the Kremlin’s approach that keeps European governments off balance while Russia manipulates gas flows. Keeping the pipeline open but uneven supplies bolsters Moscow’s influence in its economic battle with the West. It also keeps gas prices high, boosting Russian revenue that could help fund its war in Ukraine and hit European economies.

Russian President Vladimir Putin follows a summit of the leaders of Iran, Russia and Turkey in Tehran this week.


picture:

Sergey Savostyanov / Sputnik / Carmel / Shutterstock

However, this tactic carries risks for Russia, further damaging its reputation as a reliable gas supplier and encouraging European economies to Find other sources of energy. Due to the limited pipeline infrastructure to Asia, Russia is unable to reroute much of the gas destined for Europe quickly.

“I think we have to be very clear. European Commission President Ursula von der Leyen said on Wednesday that Gazprom has proven to be an absolutely unreliable supplier. Gazprom’s successor, as we know, is Putin. So what will happen is unpredictable.”

Even before maintenance began, Gazprom last month reduced pipeline shipments to 40% of capacity, blaming Canadian sanctions that have prevented the return of turbines being repaired there. European officials refused to interpret the turbines as an excuse for Moscow to attempt to wreak economic havoc on the continent.

Germany is racing to return turbines to Russia after Canada earlier this month amended its own sanctions, allowing Nord Stream pipeline turbines to be repaired and returned to Russia.

European Commission President Ursula von der Leyen on Wednesday.


picture:

Virginia May/The Associated Press

Gazprom said on Wednesday that it had not yet received documents on the turbines

Siemens Energy AG

, who handles maintenance. Gazprom said the need to maintain turbines and other equipment had a direct impact on the safe operation of Nord Stream.

Siemens Energy said in a statement that its goal has always been to get the turbine into operation as quickly as possible. The company said it was also ready to service more turbines.

The European Union is pressing governments to intensify their energy conservation campaigns, New plans for possible legalization to be introduced on Wednesday. The commission’s plan is expected to provide guidelines for reducing energy use and set standards that governments can use to decide which industries to prioritize if there is not enough gas. The guidelines also call for public buildings to limit air conditioning to 77 degrees Fahrenheit and to cover the thermostat at around 66 degrees during the colder months.

While some European officials have questioned in recent days whether Nord Stream will return online on Thursday, Mr. Putin’s comments helped fuel expectations for the pipeline to be restarted.

Separately, gas flows through the pipeline rose several times on Tuesday, which the pipeline operator said was a technically needed step in the maintenance process.

The Moscow office of the Russian gas giant Gazprom in 2021.


picture:

Alexander Nemenov/AFP/Getty Images

The operator said on Wednesday that so far there are no changes to the planned maintenance schedule.

Analysts at Goldman Sachs said they expect the pipeline to be back in operation Thursday at 40% capacity before maintenance.

In a note to clients on Tuesday, the bank wrote that a complete halt “would remove flexibility from Russia’s supply decisions, as once it hits zero there is only one place to go: up,” adding that such a scenario would also deprive Russia of gas revenue.

But Mr Putin’s new warning that flows could be curbed to 20% next week shows Moscow will continue to use gas to pressure Europe, even if it doesn’t cut it off completely, analysts say.

“It is quite clear that Moscow is cutting off supplies for geopolitical reasons — it wants to create a European gas crisis this winter to bring Europe to its knees to the point where it cuts its support for Ukraine and forces Kyiv to respond to Moscow’s demands,” Timothy said. Ash, Chief Strategist at BlueBay Asset Management LLP in London.

Putin also warned the West that his plan to reduce Russian oil prices would shake global markets and push prices higher.

“We are now hearing all kinds of crazy ideas about limiting the volume of Russian oil and putting an end to the price of Russian oil,” Putin said. “Oil prices will rise sharply.”

write to Georgi Kantchev at [email protected]

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