Gazprom throttles again: Putin earns more, although he delivers less

Within two days, the Russian state-owned company cuts gas transports to Germany.

Gazprom throttles again: Putin earns more, although he delivers less

Within two days, the Russian state-owned company cuts gas transports to Germany. According to information from Moscow, due to delays in repair work. Economist Jens Südekum considers this a flimsy bluff that Putin is filling his pockets with.

While Chancellor Olaf Scholz is in Ukraine with other EU heads of government, the Russian state-owned company Gazprom, as announced, is curbing its gas supplies to Germany through the Nord Stream Baltic Sea pipeline. In a video published on Twitter, Federal Economics Minister Robert Habeck contradicts Gazprom's claim that the partial delivery stop is related to maintenance work and indirectly to Western sanctions. From his point of view it is "a political action", the technical reasons are only pretended.

The economist Jens Südekum, like Habeck, considers this reasoning to be false: "We are in the endgame when it comes to Russian gas. Putin has already carried out similar maneuvers several times, with which he deliberately wants to create uncertainty," says Südekum As a result, prices on the gas markets rose from 80 to 120 euros in just a few hours.

"Although Putin has curbed the crowd, he's making even more money right now." This type of maneuver can certainly be repeated a few times, but at some point the markets will no longer fall for it. "If you keep bluffing and then start delivering again, the markets learn too. Then this game doesn't work anymore," says Südekum. As long as this scam still works, however, the Russian President will also use it.

It is also possible that Putin is serious and, in the worst case, the gas flow will be close to zero. According to Südekum, it is difficult to predict whether and when this day will come. But it doesn't have to take too long, after all, the federal government wants to become completely independent of Russian gas by 2024. "I don't see why Putin should wait much longer before completely stopping gas supplies," says the economist. He thinks it is likely that it could be this summer or in the fall before the next heating season starts.

The Federal Network Agency also called Moscow's approach "technically unjustifiable". The fact that Gazprom is now reducing its deliveries through Nord Stream 1 to around 40 percent is a warning signal from the point of view of the President of the Federal Network Agency, Klaus Müller. "Unfortunately, Russia is fueling uncertainty and driving up gas prices," he told the Rheinische Post.

If Gazprom only delivered 40 percent through Nord Stream 1 for weeks, Germany would have a problem, said Müller: "That would make our situation significantly worse. We could perhaps endure that over the summer, because the heating season is over. However, we now have to fill the reservoirs to survive the winter - also with Russian gas.

In view of the current decline, Habeck once again called for energy saving. In the video distributed on Twitter, the Green politician thanked the population and companies for their efforts so far. At the same time, Habeck appealed with a view to saving energy: “Now is the time to do it. Every kilowatt hour helps in this situation.”

Despite the renewed reduction in the gas delivery volume, the Federal Government currently believes that the secure supply of gas will continue to be guaranteed. "Currently, the quantities can be procured on the market, albeit at high prices. It is currently still being stored," said a spokeswoman for the Ministry of Economic Affairs.

According to Südekum, the situation is much better today than it was two months ago, when the gas storage tanks were only 20 percent full. By November, however, the storage must actually be at 90 percent - only then is the security of supply guaranteed over the winter.

"Should the scenario of a complete stop to deliveries occur at short notice, it will be extremely difficult to keep filling the storage facilities," says Südekum. The current memory level is 56 percent. According to the economist, this would not make it possible to survive the winter. In such a scenario, immediate precautions would have to be taken so that gas would not have to be rationed in winter. "Then we would have to start immediately to save gas at every point."

According to Südekum, households can currently save gas, among other things, by not taking a long, warm shower every day. "What an individual household can also contribute to saving gas will become clear next winter." He thinks Habeck's appeals to the population are correct. "But appeals alone will not do the trick."

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