Russia halts Nord Stream 1 gas flow to Europe again | Russia-Ukraine war News

Russia’s state-owned power large Gazprom has once more suspended fuel deliveries on the arterial Nord Stream 1 pipeline to Germany, citing upkeep necessities.

The suspension is the most recent in a sequence of halts to fuel provides which have contributed to an ongoing power disaster in Europe within the wake of the Russian invasion of Ukraine that started on February 24.

Gazprom stated on Wednesday that provides by way of Nord Stream 1 had been “fully stopped” for “preventive work” at a compressor unit. The announcement got here shortly after European fuel community operator ENTSOG introduced that deliveries had ceased.

Gazprom has repeatedly maintained the stoppages in provide are mandatory for routine upkeep however have been exacerbated by tools supply issues created by Western sanctions on Russia.

Germany has accused Moscow of utilizing its power sources as a weapon.

Germany’s Federal Community Company chief Klaus Mueller referred to as the most recent cessation “technically incomprehensible”, including that have exhibits that Moscow “makes a political determination after each so-called upkeep”.

“We’ll solely know originally of September if Russia does that once more,” stated Mueller, apparently referring to suspensions and reductions of flows in June and July that Russia blamed on upkeep.

Anticipated to worsen

Europe’s ongoing power crunch has seen a 400 % surge in wholesale fuel costs since final August.

The shortages have squeezed customers and companies alike, who’re reeling from sky-high inflation and the excessive value of dwelling. It has compelled governments to spend billions to ease the burden.

The scenario is anticipated to worsen as European nations enter the chilly winter months, with many properties utilizing pure fuel for heating. Some nations, together with France, have stated gasoline rationing is feasible.

Since launching its invasion of Ukraine, Russia has additionally stopped supplying Bulgaria, Denmark, Finland, the Netherlands and Poland with fuel whereas lowering flows by way of different pipelines.

On Tuesday, Gazprom stated it will droop fuel deliveries to its French contractor over a funds dispute. France’s power minister stated that was an excuse, however stated the nation had already been anticipating the lack of provide.

The European Union is making ready to take emergency motion to reform the electrical energy market with a purpose to carry rising costs underneath management, with power ministers scheduled to carry extraordinary talks subsequent week.

‘Nothing interferes with provides’

Germany, which is closely depending on Russian fuel, is faring higher than anticipated, with Mueller reporting the nation’s fuel storage was practically 85 % crammed.

Europe as a complete can be making progress in filling its fuel storage tanks. On Sunday, storage ranges had been already at 79.9 % of capability within the EU.

German financial system minister Robert Habeck, who’s main efforts to switch Russian fuel imports by mid-2024, says the nation presently doesn’t have the wanted shops to make it via the winter.

Requested if Gazprom’s provides would resume after the three-day works had been accomplished on Saturday, Russian authorities spokesman Dmitry Peskov stated “there’s a assure that, aside from technical issues attributable to sanctions, nothing interferes with provides”.

Western capitals “have imposed sanctions in opposition to Russia, which don’t enable for regular upkeep, restore work”, he stated, showing to seek advice from an incident in July when, following 10 days of scheduled upkeep, Nord Stream 1 flows dwindled.

Gazprom stated the problem was the results of a key turbine being blocked from supply to Russia due to sanctions.

Germany, from the place the turbine was being despatched, stated Moscow was the one blocking that supply.

Saudi Aramco posts biggest quarterly profit of any listed company | Oil and Gas News

Saudi Aramco posted the most important quarterly adjusted revenue of any listed firm globally pushed by excessive crude costs and manufacturing.

Aramco adopted huge oil rivals reporting a surge in income. Web revenue rose to $48.4 billion within the second quarter, up from $25.5 billion a 12 months earlier, the state-controlled firm stated on Sunday. Its free money move rose by 53% from a 12 months earlier to $34.6 billion.

The corporate is utilizing the windfall to scale back debt and put money into an enormous growth of its manufacturing capability. Aramco is betting that demand for its oil and chemical substances will stay excessive even because the world appears to be like to transition away from fossil fuels.

Aramco “expects oil demand to proceed to develop for the remainder of the last decade, regardless of downward financial pressures on short-term world forecasts” Chief Govt Officer Amin Nasser stated.

Power firms boomed within the first half of this 12 months. Russia’s invasion of Ukraine roiled markets, sending oil costs above $100 a barrel and inflicting refining margins to soar, whereas Aramco is benefiting from each excessive manufacturing and gross sales costs. Corporations akin to Exxon Mobil Corp. and Shell Plc made file earnings within the second quarter.

That’s regardless of heightened angst in regards to the penalties of local weather change, which has triggered a wave of droughts, wildfires and floods within the northern hemisphere this summer time.

However issues about local weather change, surging crude costs have led many western leaders to name on Saudi Arabia to pump extra oil to assist deal with world inflation. US President Joe Biden traveled to Jeddah final month to request a lift in oil output. But the Saudi led group has taken solely modest motion since then. At its final assembly OPEC plus agreed to a 100,000 a day output improve because it anxious about its dwindling spare capability.

International oil demand continues to be “wholesome,” Nasser stated. If aviation gas demand picks as much as pre-pandemic ranges “that may put a whole lot of tightness out there,” he stated.

Aramco is trying to work with companions to put money into carbon seize, renewable vitality, and hydrogen manufacturing, as a part of its objective to succeed in internet zero carbon emissions from operations by 2050, Nasser stated in a name with reporters. That’s even because it appears to be like to spice up its most oil manufacturing capability to 13 million barrels a day, and gasoline manufacturing by as much as 50%.

The Saudi Arabian state-controlled firm stored its quarterly dividend, an important income for the dominion, unchanged at $18.8 billion. That was not like most Western majors, that elevated payouts to shareholders.

Aramco additionally lowered gearing, a measure of debt to fairness, to 7.9% from 14.2% on the finish of 2021. Income climbed 80% to $150 billion and free money move, which had dropped beneath the extent wanted to fund its dividend funds in 2020, rose 53% from a 12 months earlier to $34.6 billion. Revenue beat an organization compiled analyst estimate of $46.2 billion.

Pumping More | Aramco's daily oil output rose to 10.5 million barrels in the second quarter

The quarter could mark a excessive level for Aramco. Whereas Brent crude averaged $112 a barrel between April and June, it’s since fallen beneath $95 because the US and European economies gradual and China imposes Covid lockdowns.

Nonetheless, Saudi Arabia is ramping up output together with different members of OPEC+, the producers’ cartel it leads alongside Russia. The dominion pumped 10.5 million barrels a day of crude within the second quarter. It elevated that determine to nearly 11 million in July and is underneath strain from the US and different main importers to go even greater, regardless of some analysts doubting it has a lot spare capability.

Aramco would haven’t any drawback producing 12 million barrels a day if requested to by the Saudi authorities, Nasser stated. The corporate can be engaged on rising crude oil most sustainable capability from 12 million barrels per day to 13 million by 2027.

It may even have one other 1 million barrels a day obtainable for export by 2030 because the nation appears to be like to interchange crude oil burning energy stations with gasoline and renewable energy.

Aramco listed in Riyadh in 2019, although it’s nonetheless 94% state-owned. Its shares have gained 25% this 12 months, giving it a market valuation of $2.4 trillion.

It may promote shares in a few of its items on the Saudi inventory trade, Nasser stated, as a part of a “portfolio optimization” plan that has already seen it dump stakes in subsidiaries that lease its oil and gasoline pipelines.

Aramco is contemplating a plan to record its buying and selling unit, individuals acquainted instructed Bloomberg in Might.

The corporate is scheduled to launch a extra detailed breakdown of its outcomes, together with the efficiency of its upstream and downstream items, on Monday.

–With help from Kateryna Kadabashy, Patrick Sykes and Leen Al-Rashdan.

What is the EU’s gas plan and does it have support of the bloc? | European Union News

The European Union’s govt department has urged member states to chop again on fuel utilization by 15 % till March as fears mount that Russia could cease supplying the vitality supply to the bloc within the coming months.

Moscow has already curtailed exports of pure fuel – used to energy factories, generate electrical energy and warmth houses – to the EU following its invasion of Ukraine in late February, as its relations with the West have deteriorated sharply.

On Tuesday, a day earlier than the European Fee unveiled its proposal for cutbacks, Russian President Vladimir Putin warned that provides might but be additional lowered.

The developments have come towards the backdrop of risky relations between Moscow and the EU over the latter’s political, financial and navy assist for Kyiv amid Russia’s offensive.

Here’s what it’s good to know:

What has the EU proposed?

The Fee stated member states ought to minimize their fuel utilization by 15 % from August to March, in contrast with their common consumption in the identical interval throughout 2016-2021.

Brussels might make the goal necessary if it deemed there was a considerable threat of extreme shortages within the bloc – within the occasion of Russia turning off the faucets utterly, for instance.

The proposal wants approval from a bolstered majority of EU international locations – at the least 72 % of its 27 member states, so 19 or extra ones – for it to be adopted.

It will likely be voted on at a gathering of the bloc’s vitality ministers on July 26.

Why has the bloc put forth this plan?

The EU is performing as a result of it’s involved that Russia could halt its fuel exports to impose extreme financial and political stress on the bloc’s member states within the winter forward, deepening an vitality standoff between the 2 sides.

Russia has already lowered provides considerably, slicing provides to a number of member states – together with Poland, Bulgaria, the Netherlands, Denmark and Finland – over their refusal to adjust to the Kremlin’s calls for for fuel funds to be made in roubles.

It additionally slashed flows by way of its Nord Stream 1 pipeline to 40 % of capability final month, citing issues with gear that it stated have been brought on by sweeping Western sanctions imposed after it launched what it calls its “particular navy operation” in Ukraine.

 

INTERACTIVE - Russian gas imports into the EU - Europe's reliance on Russian gas

The pipeline, which ends up in Germany, was shut in July for 10 days to ensure that upkeep work to be carried out, inflicting provides to Europe to plunge. It was reopened on Thursday, with flows from Russia again on the 40 % capability mark.

The resumption got here a day after Ursula von der Leyen, the president of the European Fee, accused Russia of “blackmailing the bloc” and “utilizing vitality as a weapon”.

She warned member states that they wanted to organize for a “potential full disruption of Russian fuel” and known as on them to avoid wasting provides with a view to quicken their filling of storage amenities in anticipation of what she stated have been “seemingly” cutbacks forward.

“This can be a large ask for the entire of the EU – however it’s vital to guard us,” von der Leyen advised a information convention in Brussels on Wednesday.

How has the EU’s plan been obtained by member states?

Regardless of the continued uncertainty over provides from Russia, a number of EU international locations have expressed their opposition to the bloc’s proposal for cutbacks in fuel utilization.

Poland and Spain got here out towards the plan inside 24 hours of it being put ahead.

Spanish Power Minister Teresa Ribera stated on Wednesday her nation wouldn’t again the proposal because it doesn’t rely upon Russian fuel.

Ribera’s Portuguese counterpart, Joao Galamba, stated on Thursday his authorities was additionally “completely towards” the rationing.

He advised Portugal’s Expresso newspaper that the EU proposal didn’t tackle the particular hydropower wants of Spain and Portugal, which as a consequence of a present drought have been being compelled to supply extra electrical energy by way of gas-fired crops.

“The European Fee’s proposal … doesn’t consider the variations between international locations,” Galamba stated, including that the Iberian peninsula, which doesn’t rely upon fuel piped from Russia, stays an vitality “island” with little vitality interconnection with the remainder of Europe.

INTERACTIVE - gas exports

The EU plan can be anticipated to face resistance from different member international locations together with Poland, which has stuffed its fuel storage amenities to 98 % of capability, and Hungary, which is closely reliant on Russian vitality imports.

Nevertheless, a number of different international locations resembling Denmark, Austria, Italy, Sweden and Germany have all activated emergency plans that would in the end result in fuel rationing, indicating they could again the proposal.

In the meantime, many European leaders have been chasing various fuel provides, turning to the likes of the US, Qatar, Algeria, Azerbaijan and the United Arab Emirates in latest weeks.

What has Russia stated?

Moscow has repeatedly maintained it’s a dependable vitality provider and blames Western sanctions for lowered flows to its European patrons.

Russia equipped Europe with about 40 % of its pure fuel final 12 months, with Germany being the continent’s largest importer in 2020, adopted by Italy.

Its strikes to limit provides have come as EU member states battle hovering inflation charges, with shoppers having much less to spend as vitality costs rise and the general value of residing rockets.

Any full cutoff of fuel would deal a fair heavier blow to already troubled economies struggling to bounce again from the financial devastation unleashed by the COVID-19 pandemic.

INTERACTIVE - gas reserves

On Monday, the Worldwide Power Company (IEA) warned the EU to organize for the worst, regardless of Russia’s assurances over its reliability.

“Europe is now compelled to function in a relentless state of uncertainty over Russian fuel provides, and we will’t rule out an entire cut-off,” IEA Government Director Fatih Birol stated.

“European leaders must be making ready for this chance now to keep away from the potential harm that will consequence from a disjointed and destabilising response,” he added.

“This winter might change into a historic take a look at of European solidarity – one it can’t afford to fail – with implications far past the vitality sector.”

On Tuesday, the Worldwide Financial Fund additionally warned that “the partial shutoff of fuel deliveries is already affecting European progress, and a full shutdown might be considerably extra extreme”.

It stated that gross home product in member states resembling Hungary, Slovakia and the Czech Republic might shrink by as much as 6 %, including that Italy “would additionally face vital impacts as a consequence of its excessive reliance on fuel in electrical energy manufacturing”.

Europe gas spikes 22% as Germany quarrels with Russia over supply | Oil and Gas News

Shipments from Russia through Ukraine are set to fall by about 30 % on Thursday following interruptions at a cross-border entry level on account of the warfare in Ukraine.

By Bloomberg

European pure fuel costs jumped following disruptions to a key transit route via Ukraine, and as Germany stated Russia was utilizing vitality as a weapon in an escalating conflict over provide.

The benchmark contract surged greater than 22%, with shipments from Russia through Ukraine set to fall by about 30% on Thursday following interruptions at a cross-border entry level on account of the warfare. It provides to the market’s considerations as Moscow halted shipments to Gazprom Germania GmbH and its items in retaliation.

Moscow late Wednesday sanctioned the previous Gazprom PJSC subsidiary — which is now underneath the management of the German vitality regulator — together with vitality provider Wingas GmbH and London-based unit Gazprom Advertising & Buying and selling Ltd. The transfer might additionally upend LNG markets, and convey even higher provide worries.

Nonetheless, German Economic system Minister Robert Habeck downplayed the affect, saying the Russian cuts quantity to only 3% of the nation’s imports. The nation was getting shipments from alternate sources and may address the disruption, he stated. Utility RWE AG stated Russia’s new sanctions are “not materials.”

European gas prices rise again after calm

The brand new dangers come simply as an answer gave the impression to be rising for what has been the principle headache for weeks — Moscow’s demand for ruble funds for its fuel. Firms had been more and more assured they might hold shopping for Russian provides with out breaching sanctions, with Italian Prime Minister Mario Draghi on Wednesday showing to again such a transfer. Extra European patrons are opening ruble accounts.

“The developments are solely the newest in a string of a gradual deterioration of safety of provide amid the warfare,” Eurasia Group stated in a word. “The continued disruptions will due to this fact imply EU states will step up preparations for larger fuel provide disruptions from Russia this yr.”

Dutch front-month fuel, the European benchmark, was 20% increased at 113.01 euros per megawatt-hour as of 1:54 p.m. in Amsterdam. The UK equal was up 37%. German energy additionally surged, with subsequent month’s contract rising as a lot as 17%.

Issues over Russian provides have hung over the marketplace for months. Flows through Ukraine might hit the bottom since late April, grid information present. This could have an effect on a key gas-transit route crossing Slovakia and Austria. Authorities in Vienna stated there are at present no limitations on supply.

Natural Gas Runs Through Ukraine |

Provides through the Nord Stream hyperlink to Germany, the largest pipeline route from Russia to Europe, stay secure. However, individually, flows from Norway are set to lower on Thursday.

Ukraine’s fuel grid on Wednesday stopped accepting Russian gasoline at one of many two key entry factors, saying it might now not management related infrastructure within the occupied territory within the jap a part of Ukraine. Gazprom stated it wasn’t in a position to reroute all provides to a different entry level due to how its system at present works.

No Russian fuel is flowing into the Sokhranivka station on the Ukrainian border for a second day. Sokhranivka had dealt with a few third of Russia’s fuel flows crossing Ukraine earlier than the halt, with the remainder passing via Sudzha, the opposite entry level.

“Misplaced Sokhranivka provide will not be dramatic, nevertheless it sends a sign for what would possibly come down the street,” analysts at SEB stated in a word. “This doesn’t scream disaster, however it’s a wake-up name for what’s to come back. We might doubtless see extra provide disruptions going ahead.”

Market information, evaluation

  • RWE Says Subsequent Gasoline Cost to Russia Due Finish of Could
  • Commerzbank Would Should Overview Provisions If Gasoline Stopped: CFO
  • LNG WRAP: Asian Consumers Search Extra Time period Provide as Spot Charges Rise
  • Spot LNG Costs in Asia Might Rise on Low Inventories: BNEF

–With help from Todd Gillespie.