Eurasia Press & News
Although the situation remains “tense and further deterioration cannot be ruled out,” security of supply in Germany is assured, the country’s Federal Network Agency (BNetzA) said.
Natural gas deliveries from Russia to Germany via the Nord Stream 1 pipeline were further reduced on Wednesday to 20 percent of capacity. The decision also affects the transfer of gas to countries such as France and Austria.
Russian state-owned energy company Gazprom announced the reduction on Monday citing a missing turbine. Apart from a 10-day shutdown for maintenance work earlier this month, gas flows through the strategically important pipeline had already been reduced to 40 percent.
Although the situation remains “tense and further deterioration cannot be ruled out,” security of supply in Germany is assured, the country’s Federal Network Agency (BNetzA) said.
European gas Title Transfer Facility (TTF) futures were trading at around US$230 per megawatt hour on Wednesday, three times the price before the start of the Russia-Ukraine conflict. Prices for energy products in Germany have been rising sharply and were up 38 percent year-on-year in June. Heating oil prices more than doubled, while natural gas was around 61 percent more expensive.
Germany has allowed more coal-fired power generation as a result of reduced gas supplies and is discussing a halt to the country’s nuclear phase-out. Continued operation of the remaining nuclear power plants beyond the end of the year could not be ruled out, according to the Economy Minister Robert Habeck.
In order to prepare for the coming winter, the energy ministers of the European Union (EU) member states agreed on Tuesday on a voluntary 15 percent reduction target for gas use from the average from 2017-2021 until the end of March 2023.
The decision has also made it possible to trigger a “Union alert” once security of supply reaches crisis levels. In this case, gas demand reduction would become mandatory. EU countries that are not connected to the gas networks of other member states are exempt from mandatory gas reductions.
