Natalia Zinets and Vladimir Soldatkin

MOSCOW/KYIV – The European Union cannot be blamed for its record gas prices because some members resell Russian gas at much lower prices than the rest of it, said Russian President Vladimir Putin on Friday.

Putin called upon the EU to approve a Russian pipeline route (Nord Stream 2) to alleviate the current price pressure.

The benchmark gas price in Europe rose to an all-time high on Tuesday. It has risen almost 800% over the previous year. Although the price fell on Friday, it was up by more than 400%.

Nord Stream 2 has been opposed by several states in the USA and east European nations, who claim the pipeline will place the EU more dependent on Russian gas. The US supplies only 35%, but Nord Stream 2 could be a major threat to their energy security.

Berlin and Brussels are still waiting for regulatory approval to build the Russian-German pipeline.

Putin said that the additional European gas supply would reduce the price for an exchange on the spot market, as reported by news agency RIA. He was speaking at a joint meeting with the State Council and a scientific and educational council.

The Yamal-Europe pipeline, which normally sends Russian gaz to Western Europe, was running in reverse on Friday. It pump fuel from Germany into Poland. Data from Gascade, a German network operator, added to the pressure.

Putin claimed that Poland “sidelined Russia” from the Yamal Europe pipeline management. The Yamal-Europe has been operating in reverse, sending eastward gas. This pipeline connects Russia with Belarus as well as Poland and Germany.

Putin claimed that this does not raise the Russian gas volumes for the European market. Therefore, the price is increasing,” Interfax reported.

Putin claimed that Germany would rather sell Russian gas to Ukraine or Poland than relieve an overheated marketplace.

The head of the state gas transmission operator in Ukraine stated that Russia’s Gazprom had cut daily Russian gas transit through Ukraine to 87.7million cubic metres (mcm), from 109mcm.

Sergiy Makogon posted the following on Facebook:

On Tuesday, European benchmark gas prices soared to more than 2,200 Euros ($2,495)/1000 cubic metres.

Makogon stated that Europe has set a new record in extracting natural gas from storage due to supply shortages.

Russia repeatedly denied accusations that it played politics over gaz and said it was meeting its supply contracts. Supply deals companies have stated that their agreements have been fulfilled.

MISSINGOUT

Alexander Novak, Russian Deputy Prime Minister, also stated that Europe is missing additional Russian supply due to delays in Nord Stream 2.

Novak stated that European consumers were very interested in this project and the company participating in it. However, Novak said Novak to Russian state television channel Rossiya-24.

He stated that European leaders also made errors in decreasing long-term supply contracts in favor of the spot market where prices can be more volatile.

Novak stated that countries which get gas through long-term agreements receive it at a much lower price.

Europe’s hot gas market may be able to benefit from some relief through redirected cargoes from Asia of liquefied LNG (LNG). European prices are attractive for this diversion.

Gazprom has no gas transit capacity booked by Gazprom for Russia’s gas exports through its Yamal-Europe pipe. Auction results were shown on Friday.

Gascade data for the Yamal Europe pipelines revealed flows at the Mallnow measuring point at the German-Polish border, going eastward from Germany to Poland at an hourly rate of approximately 1,218,000 Kilowatt Hours (kWh/h). These levels were recorded on Friday and are expected to remain at this level throughout the day.

According to data from Eustream, the capacity nominations of Friday’s Russian gas flow from Ukraine via Slovakia through Velke Kapusany border point was 739,843MWh. This is down from Thursday’s 785 160 MWh.

The drop in flows was offset by increased nominations from Slovakia to Czech Republic. This meant that nominations for flow from Slovakia to Austrian hub Baumgarten were fairly stable as compared to the previous day.

($1 = 0.8818 euros)