Gas prices tripling is 'within realm of possibility' says expert
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The cost of living crisis and soaring gas prices in particular have a firm hold over the continent, with inflation surging to 8.6 percent last month – up from 8.1 percent in June. Eurozone inflation is predicted to be as high as 7.6 percent this year, according to the European Commission – compared with the previous forecast of 6.1 percent. There are now real fears of a European recession but the alarming situation has exploded amid fears Vladimir Putin will wage a political war and completely cut off vital gas supplies into Europe.
Hundreds of millions of European are now facing a huge gas squeeze, with Russian supplier Gazprom confirming flows along the Nord Stream 1 pipeline to Germany will slump to just 33million cubic metres per day – a fifth of the normal capacity.
Worse still, this would halve the current, already reduced, level.
The Russian state-owned firm is insisting it needs to halt the operation of a gas turbine at a compressor station after instructions from an industry watchdog.
The Kremlin has also said a gas turbine for Nord Stream 1 has not yet arrived after maintenance in Canada and that a second turbine is now showing defects.
The European Union has accused Russia of resorting to energy blackmail and claim the move is “politically motivated” amid fears Putin could act in revenge for the economic sanctions aimed at destroying Russia’s creaking economy.
Kremlin spokesman Dmitry Peskov said: “Yes, indeed, there are some defects with the turbines.
“The turbine has not arrived after a major maintenance, it’s on its way. We hope that it will happen, sooner rather than later.”
But he warned punishments against his country had critically complicated work on Nord Stream, which has seen gas supplies to Europe slump to just 20 percent of its capacity.
The Kremlin spokesman warned: “The situation is critically complicated by the restrictions and sanctions, which had been imposed against our country.”
Veteran broadcaster Andrew Neil explained on Twitter: “Putin switched back on Nord Stream 1, but only at 40 percent capacity. As of tomorrow he cuts that to 20 percent.
“His aim is to stop the EU — above all Germany — from filling up storage capacity for winter.”
EU member states bracing for more cuts to Russian gas supply have approved an emergency plan to curb demand after striking compromise deals to curb reductions for some countries.
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Brussels is urging its member states to save gas for the winter months, with energy ministers giving the go-ahead for all EU countries to voluntarily cut gas use by 15 percent in the August to March period versus the average from 2017-2021.
German Economy Minister Robert Habeck insisted the quickfire deal would show Putin that Europe remains united in the face of Russia’s latest gas cuts, saying: “You will not split us.”
The EU’s energy chief Kadri Simson said the new agreement should ensure countries save enough gas to survive an average winter if Russia does turn off the gas tap now.
But she warned an usually cold winter would require more severe measures.
However, there are also still fears the new savings will still not be enough to avoid a winter gas crisis.
Levels vary greatly between the member states, but the bloc as a whole has only reduced its combined gas use by five percent – despite prices soaring and the problem of shortening Russian supplies over recent months.
Irish Environment Minister Eamon Ryan warned: “Fifteen percent will probably not be enough, given what the Russians have just announced.”
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