By Claire Gordon • 22 December 2021 • 21:55
The Kremlin has denied they are restricting gas supplies to Europe for political gain after gas in a German pipeline switched direction to head towards the east for a second day. This reversal in flow is keeping prices near record highs in Europe’s gas supply as winter bites.
The network operator Gascade shared data that showed the flow through the Yamal-Europe pipeline to Germany declined over the weekend before then fully stopping on Tuesday 21 December. It then reversed and went back towards Russia. Gazprom, the Russian state gas firm, said the supply was going that way because of cold weather and high demand in the country, reports the Guardian.
The benchmark for European gas prices is the wholesale Dutch gas price which rose more than 20% on Tuesday to close at a record high of €181 per megawatt hour (MWh). The Italian prime minister, Mario Draghi, has called for urgent action to reduce rocketing fuel prices in Europe’s gas supply and for assistance from the companies making money out of the surge.
“There are big producers and sellers of energy that are having fantastic profits. They will need to participate to support the economy, they too need to help families,” Draghi said in Rome. Some analysts and European politicians have suggested Moscow is deliberately suppressing gas deliveries to shore up its political position amid tensions over Ukraine and delays in European certification of another pipeline, Nord Stream 2.
The Kremlin denied using such tactics. “There is absolutely no connection [to Nord Stream 2], this is a purely commercial situation,” a spokesperson said.
The reversal of flow in the Yamal-Europe pipeline has added to other pressures that have kept gas prices at record levels in Europe’s gas supply for much of 2021. UK energy suppliers have gone bust, and knock on problems have increased electricity costs for much of Europe. The Financial Times reported that ships carrying liquified natural gas headed towards Asia have been poached by European consumers willing to pay above-average prices for the fuel.
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