Live Updates: Gazprom declares three-day shutdown of Nord Stream 1 at end of August

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© Reuters

Gazprom has announced that it will shut down the Nord Stream 1 gas pipeline, which brings gas to Europe via the Baltic Sea, at the end of August, further reducing the flow of gas to Europe as energy prices soar and as the continent struggles to find supplies after Russia invades Ukraine.

Russia’s state gas monopoly announced on Friday that it would close the only operating compressor station on Nord Stream 1, in Portovaya near St. Petersburg, from August 31 to September 2.

Gazprom said it would then resume supplying up to 33 million cubic meters of gas to Europe per day, around 20% of NS1’s capacity, or roughly the same amount it supplied by the gas pipeline to Germany in recent weeks.

Russia’s state-backed gas monopoly first cut capacity on the line in June. Gas prices in Europe have more than doubled since then and rose more than 6% on Friday to close at €256 per megawatt hour, the highest closing price on record.

Gazprom can send up to 167 million cubic meters per day through the pipeline, but has limited supply in recent months in a dispute over sanctions. The company said it was unable to supply gas in regular volumes due to delays in repairing and returning turbines made by Germany’s Siemens Energy.

European leaders and energy companies have said there are no technical problems preventing Gazprom from supplying more gas and say Russia is deliberately limiting supplies for political reasons.

In a statement, Gazprom said the repairs were mandated under its contract with Siemens Energy and that the German company’s specialists would help with the repairs.

Siemens Energy declined to comment.

“This is a stark example of Putin’s hybrid energy war against the EU,” said Sergiy Makogon, director general of Ukraine’s state-owned gas transmission network. “Ukraine and Poland have spare transit capacity, which could be used to fully offset flows via Nord Stream 1,” he continued.

Yuriy Vitrenko, CEO of Ukraine’s state-owned gas company Naftogaz, said there was “no sign that Gazprom would compensate” by pumping more gas through Ukraine’s vast pipeline, once a major route for supplying European markets. .

“The aim could be to put pressure on Germany to ease the sanctions and even to allow [Nord Stream 2]to launch, Vitrenko added.

“The prospect of Gazprom shutting down Nord Stream 1 for three days will only scare the market away,” said ICIS analyst Tom Marzec-Manser. “Gas prices jumped at the very end of the trading day when maintenance was announced and could easily rise further on Monday as buyers assess whether they really believe the pipe will be back in service, as reported. said the Russian supplier.”

Additional reporting by Roman Olearchyk in Kyiv, Martin Arnold in Frankfurt and David Sheppard in London

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