Since mid-July, Russia’s pipeline deliveries of gas via the Nord Stream 1 system have plummeted. But on Wednesday, the pressure intensified when Russia completely halted gas supplies transiting to Europe in a move it has said will last three days. As Germany is heavily reliant on Russian fuel, it has sparked chaos in the nation, forcing factories to close.
The country’s Economy Minister Robert Habeck has said that industrial producers in Germany are scrambling to slash gas use by switching to alternative fuels, and have been limiting output.
But in an “alarming” turn of events, some have been forced to “stopped production altogether”.
Mr Habeck told the Financial Times: “It’s not good news because it can mean that the industries in question aren’t just being restructured but are experiencing a rupture – a structural rupture, one that is happening under enormous pressure.”
He added: “Wherever energy is an important part of the business model, companies are experiencing sheer angst.”
It comes after Germany had already entered into the second phase of an emergency gas plan, the final phase of which would involve gas rationing measures.
And Berlin has also been warned that the plummeting volumes of gas could send the nation into a recession.
Now, the three-day cut, which the Kremlin -controlled gas giant Gazprom has blamed on planned maintenance, could make matters worse,
But the German network regulator has said that the country would be able to survive a three-day gas outage as long as flows restarted on Saturday.
Klaus Mueller told Reuters TV: “I assume that we will be able to cope with it.
“I trust that Russia will return to at least 20 percent from Saturday, but no one can really say.”
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He warned that Berlin must make sure that prices “don’t shoot through the roof”.
And despite the UK only getting four percent of its gas from Russia last year, Britain has still been impacted by Russia’s gas cuts in Europe.
That is due to the integrated nature of the gas market, which has a knock-on impact on consumer bills in the UK.
Now, largely a result of Putin’s control over the European gas market, UK customers will have to fork out as £3, to pay for the October price cap.
This is set to reach £5,000 in January, according to some forecasts, which EDF has warned could push half of UK households into fuel poverty.