Russia’s energy crisis is escalating, and so are European costs

European benchmark natural gas prices jumped 28% on Monday morning to reach €274 ($272) per MWh. nodestream 1 pipeline Indefinitely claiming to have discovered a turbine oil leak.
Last year, the pipeline supplied about 35% of Europe’s total gas imports from Russia.However Gazprom from June Just follow the stream along Nord Stream 1 20% of its capacityciting maintenance issues and a dispute over a missing turbine caught in Western export sanctions.

Moscow’s decision not to reopen the pipeline on Saturday has raised concerns that the European Union could run out of gas this winter despite successful efforts to fill storage tanks. Wholesale natural gas futures rose more than a third on Monday on concerns about

Euro falls on Friday news of pipeline indefinite closure Less than $0.99 monday — the Lowest level in 20 yearsPound hits $1.14, lowest since 1985 On local economic activity and government budgets.

Some countries are preparing large sums of money to contain the pain.

On Sunday, the German government announced a €65 billion ($64 billion) rescue package to help households and businesses cope with a spike in inflation. Germany, Europe’s largest economy, Especially dependent on Russian gas exports Power homes and heavy industry.

Together with the measures so far, the total government aid will be €95 billion ($64 billion), about 2.5% of Germany’s GDP, Berenberg chief economist Holger Schmieding said in a note Monday. said to do.

Liz Truss succeed Boris Johnson As UK Prime Minister, I am under tremendous pressure this week to announce more support for households and businesses. Utility bills soar.
Truss is considering a £100bn ($115bn) package to help with rising living costs, including paying for utilities. Sunday Timescited an unnamed source in the country’s finance department.
If so, it will exceed the cost of the country. Pandemic furlough schemeThe government subsidized workers’ salaries by around £30 billion ($34 billion) to prevent mass layoffs.

winter preparation

For many months the European Union energy reserves Fearing that Russia will further cut gas supplies, it is preparing for the colder months when usage will surge.

Russia’s gas supply to “unfriendly” European countries and energy companies that refused to pay gas bills in rubles instead of euros or dollars as stated in contracts, as Russia claims have already stopped.

Friday’s Nord Stream 1 announcement came hours later G7 countries agree to cap price at which Russia can sell oil To limit the income the Kremlin is using to fund the war in Ukraine.
spokesperson for siemens (GCTAF)German manufacturer of the reportedly faulty Nord Stream 1 turbine.

“Irrespective of this, we have already noted several times that the Portovaya Compressor Station has enough additional turbines to run Nordstream 1,” a spokesperson told CNN Business.

As the energy conflict escalates, EU countries are quickly filling up their gas storage facilities. Stores are currently filled to 82% of capacity, according to Gas Infrastructure Europe data. This is over 80% of the target the authorities have set for each country to reach him by November.

“Despite the serious risk of energy shortages, large parts of Europe expect to be able to weather the cold season without shutting down significant parts of their industry due to massive rationing of gas supplies.” said Schmieding in a note.

But European leaders recognize that more needs to be done to avoid widespread hardship and limit the impact of the recession. EU energy minister hold an emergency meeting On Friday, we will discuss plans to protect Europeans from the worst of energy price hikes.
Initial ideas include decoupling electricity prices from wholesale natural gas prices and providing emergency loans to energy companies at risk of bankruptcy, according to drafts seen by the government. Reuters.

Source: www.cnn.com

Leave a Reply

Your email address will not be published.