That possibility is the subject of renewed controversy as maintenance on the Nord Stream 1 gas pipeline from Russia to Germany begins on Monday. Officials have expressed concern about whether the gas supply will resume after the repair period ends in 10 days.
“If earlier it was a routine procedure that attracted almost no attention, this time there are fears that Russia will not resume gas supplies after that,” Commerzbank analysts said in a note to clients.
Pipeline flows have already been reduced. Last month, Germany, Europe’s largest economy, announced a “gas crisis” after Gazprom, Russia’s state gas company, cut Nord Stream 1 exports by 60%.
Gazprom blamed the West’s decision to halt supplies of vital turbines due to sanctions, but politicians in Europe took it as a warning shot.
“Anything can happen. Maybe gas will flow again, even more than before. Maybe nothing will happen at all,” German Economics Minister Robert Habeck said in a radio interview on Sunday. “Honestly, we should always prepare for the worst and work a little for the best.”
France’s finance minister also said on Sunday that the country must act quickly and effectively to prepare for a “complete shutdown of Russian gas supplies” even though it is less dependent on gas for energy than Germany.
Nord Stream 1, which was launched in 2011, transports 55 billion cubic meters of gas per year to Europe via the Baltic Sea. As a rule, Gazprom coped with the maintenance period by increasing supplies to Europe through other pipelines or using storage facilities. According to S&P Global Commodity Insights, this time around, the company said that was not an option.
Italian gas giant Eni said on Monday that Gazprom had told it that it would start delivering 21 million cubic meters of gas per day. The average value over the past few days was about 32 million cubic meters per day.
Europe is in a hurry to abandon Russian energy resources, but it is especially difficult for it to reduce its dependence on gas. The region received 45% of its natural gas imports from Russia last year and is currently rushing to fill up storage ahead of winter.
Berlin has launched the second phase of its three-phase emergency gas program. This takes him one step closer to rationing supplies for industry players, a move that would deal a huge blow to the manufacturing heart of the country’s economy.
Estimated natural gas prices in Europe rose to their highest level since March last week. In the coming days, they may continue to rise, which will increase pressure on governments to develop contingency plans.
“Fears are likely to push the price of gas even further until it is clear what will happen to gas supplies once the maintenance work is completed,” Commerzbank said.
— Chris Liakos contributed reporting.