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 vitality firm OMV have been halted hours after Vienna mentioned Russia had given discover it could reduce off flows.
Russia, which earlier than the Ukraine battle was the most important single provider of to Europe, has misplaced nearly all of its European prospects because the EU tried to scale 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 12 months as Kyiv doesn’t need to lengthen a five-year transit settlement which brings northern Siberian fuel to Slovakia, the Czech Republic and Austria.
Austria mentioned on Friday that Moscow had knowledgeable it that the fuel could be shut off from Saturday following an arbitration award to OMV, Austria’s largest vitality provider, over unfulfilled Gazprom provides to its German unit.
On Saturday, Austria’s vitality regulator E-Management mentioned 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 looking for 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 fee for fuel provided by way of Ukraine.
Gazprom mentioned it could 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 steady however nominations for flows to Austria from Slovakia have been round 16% under averages seen this month, information 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 practically two years, as European leaders wait to listen to Donald Trump’s concepts on ending the most important land battle in Europe since World Battle Two.
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In keeping with the Kremlin, Putin informed Scholz that Russia had all the time fulfilled its contractual obligations for vitality provides and was “ready for mutually beneficial cooperation if the German side shows interest in 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 vitality enterprise which linked the Soviet Union, then Russia, and Germany, by far Europe’s largest financial 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 battle, Gazprom’s market share has been misplaced to Norway, america and Qatar.
The Yamal-Europe pipeline by way of Belarus was closed down after a dispute whereas Russia blamed america and Britain for the mysterious explosions below the Baltic Sea that closed the Nord Stream route.
Washington and London have denied they blew up the pipelines. The Wall Road Journal has reported Ukrainian officers have been behind the assault. Kyiv has denied that.
With out Austria, vital Russian provides will solely go to 2 European nations – Hungary and Slovakia, in Hungary’s case by way of a pipeline working principally via 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 information 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.
