The spot price of gas in Europe has topped $2,100/1,000 cubic meter on expectations that another gas compressor unit at Nord Stream will go out of service.
Gazprom said on Monday that it was shutting down another Siemens gas turbine engine at the Portovaya compressor station as it was reaching the end of its operating period before overhaul.
As a result, the daily capacity of the Portovaya station from 07:00 Moscow time on July 27 will be up to 33 million cubic meters per (20% of the capacity) compared to the current 67 million cubic meters per day (40% of the capacity).
As prices have spiked, EU leaders have accused Russia of using gas as a political weapon. But after decades of reliance on the cheap fuel for heat, power generation and industry, the continent has few easily available alternatives.
Dmitry Medvedev, a former president and Gazprom chairman and now a senior Kremlin official known mainly for his dyspeptic social media posts, went further Tuesday. “The blue-and-yellow hysteria,” he wrote, referring to the colors of Ukraine’s flag, “has caused severe diarrhea from the fear of freezing in their chilly homes, looking out frost-covered windows at idle factories.”
Russia is using its energy leverage as a political tool to retaliate in kind. Publicly, Russia claims that technical issues like missing paperwork and turbine maintenance have forced it to slash supplies in recent weeks. But in reality, the Kremlin is using the disruptions in Nord Stream, its main remaining pipeline supplying Europe to raise the political heat on leaders there to reconsider the painful sanctions they’ve imposed and their support for Kyiv.
The gas dispute is the latest raising of the stakes in the crisis over Russia’s invasion of Ukraine and shows the Kremlin’s willingness to forgo tens of billions of dollars in export revenues to further its geopolitical aims. Gazprom has analyzed the possible impact of a cutoff lasting into next year, according to a person familiar with the situation, and found ways to limit the financial damage thanks to surging prices and revenue so far this year.
