By Vladimir Soldatkin and Man Faulconbridge
MOSCOW (Reuters) -Russian fuel large Gazprom (MCX:) continued to pump regular volumes of fuel to Europe by way of Ukraine on Saturday, however provides to Austrian power firm OMV have been halted hours after Vienna stated Russia had given discover it will reduce off flows.
Russia, which earlier than the Ukraine warfare was the most important single provider of to Europe, has misplaced nearly all of its European prospects because the EU tried to cut back its dependence and the Nord Stream fuel pipeline to Germany was blown up in 2022.
Now one of many final predominant Russian fuel routes to Europe – the Soviet-era Urengoy-Pomary-Uzhgorod pipeline by way of Ukraine – is because of shut down on the finish of this yr as Kyiv doesn’t need to prolong a five-year transit settlement which brings northern Siberian fuel to Slovakia, the Czech Republic and Austria.
Austria stated on Friday that Moscow had knowledgeable it that the fuel can be shut off from Saturday following an arbitration award to OMV, Austria’s greatest power provider, over unfulfilled Gazprom provides to its German unit.
On Saturday, Austria’s power regulator E-Management stated Gazprom’s deliveries to OMV had stopped at 6 a.m. native time (0500 GMT), including that costs and provides to Austrian prospects have been regular.
OMV is in search of to recuperate the 230 million euro damages awarded throughout arbitration from Gazprom by off-setting the declare in opposition to invoices for deliveries to Austria – primarily stopping some cost for fuel equipped by way of Ukraine.
Gazprom stated it will ship 42.4 million cubic metres of fuel to Europe by way of Ukraine on Saturday, the identical quantity as on Friday.
Flows into Slovakia from Ukraine have been secure however nominations for flows to Austria from Slovakia have been round 16% under averages seen this month, knowledge from transmission system operator Eustream confirmed.
OMV normally accounts for round 40% of Russian fuel flows by way of Ukraine, or some 17 mcm per day.
Chancellor Olaf Scholz spoke to President Vladimir Putin on Friday for the primary time in almost two years, as European leaders wait to listen to Donald Trump’s concepts on ending the most important land warfare in Europe since World Battle Two.
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In keeping with the Kremlin, Putin advised Scholz that Russia had at all times fulfilled its contractual obligations for power provides and was “prepared for mutually useful cooperation if the German facet exhibits curiosity on this”.
Soviet and post-Soviet leaders spent half a century from the invention of main Siberian fuel deposits within the post-WW2 years increase an power enterprise which linked the Soviet Union, then Russia, and Germany, by far Europe’s greatest economic system.
Battle, and explosions, have destroyed that hyperlink, damaging the economies of each nations.
At its peak, Russia was supplying 35% of Europe’s fuel however because the 2022 warfare, Gazprom’s market share has been misplaced to Norway, the USA and Qatar.
The Yamal-Europe pipeline by way of Belarus was closed down after a dispute whereas Russia blamed the USA and Britain for the mysterious explosions beneath the Baltic Sea that closed the Nord Stream route.
Washington and London have denied they blew up the pipelines. The Wall Avenue Journal has reported Ukrainian officers have been behind the assault. Kyiv has denied that.
With out Austria, important Russian provides will solely go to 2 European nations – Hungary and Slovakia, in Hungary’s case by way of a pipeline working principally by Turkey.
Russia shipped some 15 billion cubic metres of fuel by way of Ukraine in 2023, about 8% of peak Russian fuel flows to Europe by way of varied routes in 2018-2019, in response to knowledge compiled by Reuters.
In 2023, the Ukraine transit route met 65% of fuel demand in Austria and its japanese neighbours Hungary and Slovakia, in response to the Worldwide Vitality Company.