Germany turns more pessimistic on Russian gas this winter

German flag Source: iStock/photosvit

German Economy Minister Robert Habeck said the country can’t rely on gas supplies from Russia, as Europe braces for energy shortages this winter. 

Germany is becoming increasingly pessimistic about the role of Russia’s Gazprom PJSC in supplying the vital fuel during the coldest months. Gazprom has stopped deliveries to Europe through its main pipeline for what it said would be three days from Wednesday, and there are growing expectations that the flows will be used as a way to squeeze the bloc on sanctions. 

Europe will find out on Saturday if the gas is coming back after the current bout of maintenance. Early grid data indicate that it will -- though it’s still to be confirmed. The government in Berlin fears these works will be quickly followed by another disruption in mid-October, according to people familiar with the administration’s thinking. 

“We should not count on gas coming via the Nord Stream 1 pipeline over the winter,” Habeck told reporters on Thursday in Berlin, adding that he’s not in touch with the Russian state-run supplier. “What I do expect is that we cannot rely in any way on Russia, or on Gazprom, the rest is pure speculation.” 

Habeck and German Chancellor Olaf Scholz have accused the Kremlin of exploiting Europe’s dependence on Russian energy as a weapon to retaliate against sanctions imposed after it invaded Ukraine.

During the summer when demand is low, Europe has been filling its gas storage facilities and is now about two months ahead of schedule, countering the risk that Moscow could keep shipments at minimal.

Germany announced Thursday that it will charter an additional floating terminal for importing liquefied natural gas beyond the four it is already installing to try to replace flows from Russia.

Floating terminals are faster and cheaper to install than land-based projects. Germany aims to start at least two such facilities already this heating season, with the others planned for the following winter. Uniper SE and RWE AG will help supply the first two terminals.

Germany is leading Europe’s efforts to install LNG import terminals, but such plants are also planned in the Baltics, Italy and France. Two new Dutch LNG terminals are slated to start importing LNG already this month, easing Europe’s concerns just as Russia is slashing pipeline-gas deliveries.

Germany’s fifth floating terminal will be in Wilhelmshaven with a capacity of at least 5 billion cubic meters per year and is scheduled to go into operation in the fourth quarter of 2023.

Together, the floating terminals alone could cover around a third of gas demand by end of 2023, the German government said. 

© 2022 Bloomberg L.P.

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