European Energy Prices Fall As Nord Stream To Resume Gas Flow Saturday

Europe is bracing for more Russian natural gas supply cuts through the fall into frigid winter, but Friday brought rare good news as Nord Stream operator data shows that flows will be back on for Saturday.

Bloomberg confirmed Friday that “Russia looks set to resume gas supplies through a key pipeline to Europe, a relief for markets even as fears persist about more halts this winter. Prices plunged as much as 16%.”

Yet Germany especially is still alarmed and fearful as Berlin officials are warning the public the country cannot rely on Russian gas at all to get through the colder months. Gazprom has already notified customers that its only functioning turbine at Nord Stream’s entry point (the Portovaya compressor station – near Russia’s Vyborg on the shores of the Gulf of Finland) will require technical maintenance every 1,000 hours.

Per a Kremlin announcement, reported in Bloomberg: 

That’s about every 42 days, with the next checks due in mid-October. Only one turbine is capable of pumping gas into the pipeline at the moment, without any back-up, which means the “safety of the whole system is under threat,” the Kremlin said Friday.  

Resumption of flows for Saturday remains on-schedule, according to Gazprom’s newly published data, after concerns that the Russian energy giant would use “maintenance” as a continued excuse to keep operations at a halt: 

Shipment orders, published by the pipeline’s operator, indicate that flows are expected to restart from 2 a.m. Berlin time on Saturday at 20% of normal capacity, the same level as before the work. Orders don’t guarantee actual flows, and normally it takes time for supplies to recover to planned levels. Russian Deputy Prime Minister Alexander Novak signaled on Thursday the country is sticking to schedule, according to Tass news service. 

It was only on Tuesday of this week that Moscow last threatened that Nord Stream would close, naming sanctions and maintenance as the cause. 

“There are guarantees that, apart from technological problems caused by sanctions, nothing hinders the supplies,” Kremlin spokesman Dmitry Peskov said. This immediately elicited another charge of “weaponized energy” issued by National Security Council spokesman John Kirby – a familiar refrain at this point. 

Gazprom has halted gas supplies via Nord Stream 1 for a 72hr period of maintenance. Russian energy supplies to #Germany continue to dwindle as Germany pays the price for the sanctions it has imposed on RU. There’s no such thing as a SANCTIONS FREE LUNCH.https://t.co/FHPX5ojrWC

— Steve Hanke (@steve_hanke) August 31, 2022

A German official, Markus Soeder, premier of the German state of Bavaria, seconded the White House assessment while admitting Berlin essentially has zero leverage as Moscow ratchets up the pressure. He said Russia “is playing a game with Nord Stream 1 and Nord Stream 2. I think it’s a kind of game. Our problem right now is that we are not in a position to adequately respond to this game.”

Meanwhile, Dmitry Medvedev, the deputy head of Russia’s Security Council, responded fiercely the the latest G7 oil price cap plan as follows: “The time has come for the EU to impose a price cap on pipeline gas from Russia, said Aunty Von Der what’s her name Leyen. It will be the same as with oil. There will be no Russian gas in Europe,” he stated.