Gas Prices Rise in Europe as Russia's Energy War on the West Escalates

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Gas prices spiked in Europe as Russia escalated the 'energy warfare' on Wednesday by cutting gas supplies to Europe further.

Russia made good on the threats of supply reduction a day after the European Union struck a unified stance and agreed on unprecedented consumption curbs.

War of Attrition

According to the BBC, European gas prices rose nearly 2 percent following the latest Russian action, even as European capitals are accusing Russia of using gas as a political weapon. Russian state-owned gas monopoly Gazprom says the latest capacity reduction is caused by maintenance work on a turbine.

Nord Stream Gas Lines to Europe
Nord Stream Gas Lines to Europe Gazprom

Vitaly Markelov, Gazprom deputy CEO, said the gs exporter has not received a Siemens turbine used at Nord Stream 1's Portovaya compressor station, according to Reuters.

Reuters reported that the cut in supplies by Gazprom means that gas flows from Nord Stream 1 pipeline are reduced to a mere fifth of its total capacity.

Germany, the largest economy in the EU bloc, is the hardest hit among the European nations. Germany imports 55 percent of its gas from Russia.

European Consumption Curbs

On Tuesday, European Union nations agreed to voluntarily reduce gas consumption by 15 percent from August to March as they brace for significant reduction in Russian gas supplies. The agreement was arrived after European Union energy ministers approved wide-scale exemptions for some member states and industries from the mandatory 15 percent cut in gas consumption, which Brussels demanded anticipating the worst case scenario of total stoppage of Russian gas in the winter.

Gazprom Wikimedia Commons

Russia used to supply 40 percent of gas the EU needed before the Ukraine war started. Moscow has promised it will remain a dependable energy supplier despite the harsh sanctions slapped on it by the West. Russian Foreign Minister Sergei Lavrov, who is touring Africa in a bid to shore up diplomatic support, vowed again this week Moscow will abide by the principles of trade when it comes to gas deliveries.

This article was first published on July 27, 2022