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Russian gas: such a long winter to last

by Mary
July 28, 2022
Russian gas: such a long winter to last




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Gazprom carried out its threat. Since July 27, the gas group, armed wing of the Kremlin, has reduced its gas supplies to Europe to a minimum. Germany now only receives 20% of its usual deliveries of Russian gas which pass through the Nord Stream 1 gas pipeline. The Italian group Eni has seen gas arrivals from Russia decrease in the same proportions. Gazprom justified these cuts by technical difficulties and maintenance problems. ” Udon’t prank”, replied the German Minister of the Economy, Robert Habeck, judging the explanations of the gas group not very credible.

For weeks, European countries have been convinced that Russia will use gas as a weapon against them in its war against Ukraine. Last week, the European Commission warned that the interruption of Russian gas supplies was imminent. At this point, Vladimir Putin has not stopped everything. He continues to hold Europe by a thread and keep it dancing.

Evolution of gas contracts in Amsterdam over one year (in euros per MWh). © Dutch TTF

While the gas market is already overexcited, Gazprom’s maneuvers have exacerbated tensions. On Wednesday, gas prices on the Amsterdam market, which serves as a benchmark in Europe, rose by more than 13% during the day to reach 202.5 euros per megawatt hour. The bar of 200 euros per MWh has become the minimum reference for September or October futures contracts. This is nearly ten times more than a year ago, more than double the prices in June.

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