Gazprom started filling storage facilities in Germany

MOSCOW, 12 Nov 2021, RUSSTRAT Institute.

The German press reports that the Russian concern “Gazprom” has started to increase gas supplies to Germany. According to the business newspaper Handelsblatt, “indeed, the first signals have appeared that the flow of gas from Russia to the EU is increasing”.

According to Sebastian Bleschke, managing director of the INES association of gas operators, since November 6, the gas storage tanks operated by Gazprom have been filled, since the volumes of gas injection exceed the volumes of its withdrawal.

In turn, the Russian concern issued a statement on November 9: “Gazprom approved and began implementing a plan to pump gas into five European underground storage facilities for November. The volumes and routes of gas transportation have been determined.”

This suggests that Moscow is fulfilling its promises. We will recall that at the end of October, Russian President Vladimir Putin instructed Gazprom CEO Aleksey Miller to increase the volume of gas in European storage facilities. Meanwhile, according to analysts, storage facilities in Europe are currently filled with about 82 billion cubic meters of gas, which is 76% of their volume, and this is about 15% less than it was on average over the past five years.

Such a deplorable state of things is the result of ill-considered actions of the EU member states and the EU governing bodies, who got carried away with “green energy” and the rejection of long-term supplies in favour of the spot market. But when demand increased sharply, the same USA and Qatar began to redirect tankers with their LNG to Asia from Europe.

“Putin has spoken several times in favour of returning to long-term contracts, because this would give Russia security when planning the development of new fields,” the German newspaper Die Welt states in this regard. “Therefore, the price of gas should be tied to the price of oil. Russia is also increasingly producing liquefied natural gas and therefore can respond more quickly to problematic situations.

But the main thing is that, as was stated by the General director of Gazprom Export, Elena Burmistrova, “unlike suppliers of liquefied natural gas, we are firmly connected to Europe through our pipeline network”. Therefore, Gazprom was able to increase exports only to Germany by 30% in the first nine and a half months of this year compared to the same period last year.

And still there are enough dissatisfied people in Europe. They claim that Moscow is filling European storage facilities too slowly. Critics are concerned that Gazprom, instead of “the previous 256 million a day, now pumps about 272 million cubic meters through three major pipelines to Germany. This is a step, but a small one.”

However, it is well known why Gazprom does this. Initially, the concern had to fill Russian gas storage facilities in order to provide gas to the households of our country and the national economy in the autumn-winter period. Any responsible state in Russia’s place would have done exactly the same.

In addition, there are problems related to the Ukrainian transit route. It’s not without reason that Gazprom wants to do without Ukraine, which has long been the most important channel for Russian gas supplies to Europe. The route through Ukraine is longer and therefore more expensive.

In addition, the Ukrainian gas transmission network is in poor condition and will not withstand increased pressure in the event of an increase in gas pumping through it. Therefore, when Kiev offered Gazprom to increase transit in exchange for a reduction in transit duties, the Ukrainian side had to be refused for security reasons. Pipes will burst – and Europe will lose billions of cubic meters of gas.

And it’s this combination of objective factors and human imprudence of European officials that has led to the fact that Gazprom is cautiously engaged in filling gas storage facilities in Europe. Here it’s the case when in order to gain ground you need to slow down. Of course, European consumers will have to endure high gas prices for some time, dress warmer at home and take showers and cook hot meals less often. But it’s better that way than to stay completely without gas.

Institute for International Political and Economic Strategies – RUSSTRAT

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