The gas crisis in Europe unleashed by the Kremlin has sent gas prices soaring. Gas superiority is one of Moscow’s favorite tools for fulfilling political ambitions. The current background is perfect to exert pressure on European consumers before the launch of Nord Stream 2 which is “entirely commercial project”.
Gas prices have zoomed to all-time highs at the Dutch TTF hub, proving that Europe is going through a full-blown energy crisis. In late September, benchmark gas prices almost reached the alarming level of $1,000 per cubic meter. The following 5% retracement did not calm down market jitters. Inflated gas prices cause a panic among investors and consumers, facing enormous utility bills. Most commodity experts are certain that Russia is to blame for orchestrating and maintaining the gas shortage for the obvious reason that the Kremlin forges ahead with launching Nord Stream 2. Moreover, the situation is getting worse due to buoyant demand in Asia. Asian countries are urgently buying extra liquefied natural gas (LNG) cargoes.
Citing Bloomberg’s insider sources, Russia’s gas giant Gazprom is planning to begin gas supplies through one of the Nord Stream 2 pipelines to Germany from October 1. However, the German regulator dispelled these rumors. Spokesperson of the German Network Agency (Bundesnetzagentur) Fite Wulf said that although the documents for the certification of the gas operator had been already on the table, the regulator would eventually greenlight the project in 2-4 months. Apparently, Russia is braced for the utmost delay. In his recent statement, Russian foreign affairs minister Sergey Lavrov supposed that Germany would unveil its verdict in early 2022. Besides, he noted that the project was still targeted by its opponents.
The escalating energy crisis in Europe could be stemmed if Gazprom agreed to flow additional transit volumes through Ukraine. Undoubtedly, the state-owned company refused to supply bigger volumes than the ones stipulated in the contract. The Ukrainian gas transmission network has enough capacity to deliver more than 100 billion cubic meters of natural gas per year. Currently, the network is running 40 billion cubic meters set out in the contract.
