Russia’s Gazprom tells Europe gas halt beyond its control

LONDON

Russia’s GazpromCustomers in EuropeIt cannot be guaranteed gasA letter seen by indicates that supplies are being made due to “extraordinary” circumstances. ReutersThis is an increase in economic titt-for-tat by the WestOver Moscow’sInvasion of Ukraine.

Dated July14 The letter from RussianYour state gas monopoly, saidIt declared force majeure on supplies, beginning from June 14.

KnownAs an “act of GodThe’clause, force majeure is a standard in business contracts. It spells out extreme situations that relieve a party of their legal obligations.

Gazprom’s GAZP.MM had no immediate comment.

Uniper, Germany’sThe largest importer Russian gas, was one of the customers who saidThey received a notice that the letter had been sent and it stated that it had officially rejected their claim for unjustification.

RWE RWEG.DE, Germany’sThe largest power producer, and another importer Russian gasAlso see saidIt has received a Force Majeure Notice.

“Please understand that we cannot comment on its details or our legal opinion,”The company said.

A trading source asked not to be identified due to the sensitive nature of the issue. saidForce majeure was concerned with supplies through the Nord Stream1 pipeline, major supply route GermanyAnd beyond.

FlowsThe pipeline’s capacity is at zero because the link has to undergo an annual maintenance. This maintenance began on July11 is intended to be the conclusion Thursday.

EuropeFears MoscowThe pipeline could be kept in service as a retaliation against the sanctions. RussiaOver the war UkraineThe region is at risk of falling into recession due to the escalating energy crisis.

DELIVERY OF TURBINE

AlreadyOn June 14, GazpromPipeline capacity had been reduced to 40% by the company, citing delays in a turbine being kept in. CanadaEquipment supplier Siemens Energy ENR1n.DE.

CanadaThe turbine was sent for the Nord Stream gas pipeline to GermanyBy plane July17 after repairs were completed KommersantNewspaper reported MondayCiting people who are familiar with the situation.

ProvidedAlthough there are no difficulties with logistics or customs, the turbine will need to reach its destination in five to seven additional days. RussiaThe report can be accessed here said.

Germany’sMinistry of Economy saidOn MondayIt was unable to provide any details regarding the location of turbine.

ButThe ministry’s spokesperson saidIt was a replacement part meant to only be used from SeptemberSignificance itsAbsence could not be the true reason for the fall in gasFlows before the maintenance

“This sounds like a first hint that the gas supplies via NS1 will possibly not resume after the 10-day maintenance has ended,” said Hans van CleefABN senior energy economist Amro.

“DependingWhat ‘extraordinary’It is possible to declare force majeure if certain circumstances exist. Whether these are technical or political issues, it could be the next step in the escalation of the situation. RussiaAnd Europe/GermanyHe said so.

AustrianOil and gasHowever, group OMV OMVV.VI saidOn MondayIt was expected gasDelivery starting from RussiaThrough the Nord Stream1 pipeline will be able to resume normal operations after the outage.

Russian gasSince a few months ago, major routes have seen a decline in supplies. UkraineAnd BelarusBoth through and in Nord Stream1 below the Baltic Sea.

The European UnionThe government of Iran has imposed sanctions against MoscowIt aims to end using RussianHowever, it wants fossil fuels to be out of use by 2027 and that supplies continue as it discovers new sources.

For MoscowFor more information, please visit: GazpromEnergy flows are vital revenue streams. WesternOversight of sanctions Russia’sInvasion of UkraineThe following is a list of the KremlinTerms “special military operation,”Have strained Russian finances.

AccordingTo the Russian Finance MinistryThe federal budget received $6.5 trillion ($115.32 million) from oil and other sources. gasThe first half of the year saw record sales. ThisThis is compared with the planned 9.5 trillion rubles for the entire 2022.

ThePayments on two are subject to grace period Gazprom’sInternational bonds expires July19. If foreign creditors aren’t paid by the due date, then the company is technically in default.

(ReportingBy Julia PayneAdditional reporting by Christoph SteitzIn Frankfurt, Bozorg SharafedinIn LondonBy Nina ChestneyIn London; EditingBy David Goodman, Edmund BlairAnd Barbara Lewis)