Russia’s gas giant Gazprom said on Tuesday that its natural gas exports slumped by 36.2 percent to 78.5 billion cubic meters between January and the middle of August, as deliveries to Europe plummeted.
Natural gas production also fell, slipping 13.2 percent to 274.8 billion cubic meters between January 1 and August 15 compared to the same period of 2021, according to a Gazprom statement.
Since the Russian invasion of Ukraine, Gazprom has slashed supply to European Union member states, including by cutting off deliveries to Poland, Bulgaria, and Finland. Two months ago, Russia drastically cut gas supply via the key Nord Stream pipeline to Germany to 40 percent of capacity. Following a 10-day regular maintenance period, Gazprom further slashed Nord Stream flows to 20 percent of the pipeline’s capacity at the end of July. The Russian explanation for the even lower gas flows to Europe was that another turbine at a compressor station was sent for repairs, while the one that Canada returned from repairs has yet to be returned and installed.
The EU, for its part, has reduced its dependence on Russian gas deliveries by 50 percent, but savings will be necessary to make up for the difference with alternative supplies. This is what the High Representative of the EU for Foreign Affairs and Security Policy, Josep Borrell, said earlier this month in a blog post.
“We have already managed to cope with an overall reduction in the share of Russian gas imports from 40% at the beginning of the year to around 20% today, principally by buying more LNG, whose share of gas usage has doubled from 19% to 37%,” the EU’s top diplomat said.
Also on Tuesday, Gazprom warned that Europe’s benchmark gas prices could jump by 60 percent this winter.
European gas prices are already very high and have continued to rise this week as demand is high in a heatwave and supplies of other fuels for power generation are constrained by low water levels on Europe’s main petroleum transport corridor, the Rhine River.
Europe’s benchmark gas prices at the Dutch TTF hub increased by 2% to $215.50 (211.35 euro) per megawatt-hour on Monday, and jumped by another 5.9% at $243 (239.62 euro) a megawatt-hour on Tuesday morning in Amsterdam.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com: