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EU rushes to free itself from Russian gas noose – POLITICO

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The kick-off has been fired in the race to get enough gas this winter and the stakes couldn’t be higher – whether the EU is able to free itself from Russian domination or whether the Kremlin can inflict enough pain to the bloc to undermine his support for Ukraine.

The key is whether the EU has enough gas to overcome Russia’s blackmail efforts, which is why the EU wants member countries to fill their gas storage to 80% capacity by November 1. The European Parliament backed the plan on Thursday.

But the Kremlin is well aware of the risk of EU failure.

Gas flows are falling rapidly, with 12 EU countries noting complete or partial shutdowns of Russian gas.

“The risk of a complete gas cut is now more real than ever,” Commission Vice-President Frans Timmermans told MEPs on Thursday. “That’s why passing the gas storage regulation…is so important right now.”

“It’s all part of Russia’s strategy to undermine our unity,” he added.

The EU is ahead of schedule in filling gas reserves for an ordinary year, with countries starting to load a month ahead of schedule. Total gas storage across the block is currently filled to around 55% capacity.

But this is no ordinary year.

Gazprom last week cut gas flows to 40% capacity along the Nord Stream pipeline, citing an equipment problem caused by Western sanctions, affecting deliveries to France, Italy, Austria and Germany.

Moscow insists that the reduction in flows is a purely technological problem, with Kremlin spokesman Dmitry Peskov saying on Thursday that there was “no hidden agenda” behind the decision.

EU countries do not accept the Kremlin’s explanation.

On Thursday, Berlin triggered the second stage of its three-stage gas emergency warning system – one stage before taking control of power distribution and rationing gas supplies. It has also pledged to temporarily switch on its coal-fired power plants, as have Austria and the Netherlands.

“We should have no illusions, cutting gas supplies is Putin’s economic attack on us,” said Vice Chancellor Robert Habeck, who warned of tough times ahead. “It will be a rocky road that we as a country must now walk. Even if you don’t really feel it yet: we are in a gas crisis.”

Gas flows will fall even further next month when Russia shuts down Nord Stream for what it says is regular maintenance.

Russia’s leverage is fading

If Russia continues to ship gas, the EU could meet its storage target by October, said Simone Tagliapietra, senior energy researcher at the Bruegel think tank. But if Moscow closes the taps, hitting the target will be “super difficult”, he said.

Indeed, alternative supplies cannot offset Russian deliveries, explained Thomas Rodgers, energy analyst at consultancy ICIS. A record total of 12.6 billion cubic meters of gas will enter Europe from countries other than Russia in 2022, according to ICIS modeling, compared to the 25 billion cubic meters that arrived from Moscow in the first half of this year.

“The extra gas they can give to Europe, they’re already giving,” he said, “any extra gas supply isn’t going to come any time soon.”

If imports from Russia stop, he said, European nations will be forced to ration gas, starting with industry and then power generation and residential uses.

The race to secure enough gas storage may also affect the outcome of the war in Ukraine.

“The Russian influence is not that big,” said Alexander Gabuev, senior fellow at the Carnegie think tank. “He doesn’t have many good cards to play and gas is obviously the Kremlin’s card.”

If Moscow can harm the EU economy by cutting gas supplies, Gabuev said, it could reduce public support for funding Ukraine’s war effort. If the EU meets its gas storage targets, EU countries will likely continue to send money and arms to Kyiv.

This makes a cut likely.

“The probability is very high – it’s almost 100%,” said Mikhail Krutikhin, co-founder of independent consultancy RusEnergy and a leading expert on Russian gas export monopoly Gazprom.

“Putin would rather use Gazprom as a weapon right now,” he said, than risk the EU filling up its storage.

“I think Putin will be ready to sacrifice Gazprom,” he said, adding that such a move would likely lead to the loss of around 200,000 jobs in the country and cut the 7% of the federal budget from government revenue. gas.

Krutikhin estimated that a shutdown could come as early as July or August, allowing Russia to exert maximum pressure on the bloc while giving Moscow enough time to see how the decisive battles unfold in the east. Ukraine.

The weather will also come into play.

If next winter is cold, ICIS’ Rodgers said that wouldn’t be enough to get EU countries through a heating season, even if they met the 80% storage target.

“During all but the warmest and mildest winters, that would make things extremely tight in terms of the gas market,” he said.

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