BERLIN (Realist English). Amid rising tensions between Moscow and the west over the conflict in Ukraine, Russia has already drastically reduced its exports of gas to Europe’s largest economy. Berlin now fears a winter gas crisis that could paralyze industry and leave millions freezing in their homes, warns columnist of the British newspaper Financial Times Joe Miller.
“All eyes are on Nord Stream 1, the pipeline linking Russia directly to Europe via the Baltic Sea. Gazprom, Russia’s state-controlled gas giant, reduced NS1’s capacity by 60 per cent in June, and last Monday shut it down completely for routine maintenance. In normal circumstances, this lasts just 10 days. But the fear in Berlin is that NS1 will not come back into operation as scheduled this Thursday, July 21. A protracted cut-off beyond this week will stymie Germany’s plans to stock up its gas in storage ahead of the heating season,” he notes.
SKW Stickstoffwerke Piesteritz’s Chief Executive Petr Cingr is in no doubt about the fate that awaits his chemicals company if Russia cuts off all gas supplies to Germany.
“We have to stop [production] immediately, from 100 to zero,” said he.
If Russian gas supplies stop completely, most economists expect that the economic center of the eurozone will experience a serious drop in production.
No gas this winter would, according to analysts at Swiss bank UBS, trigger a “deep recession” with almost 6 per cent wiped off GDP by the end of next year. The Bundesbank has warned that knock-on effects on global supply chains would “increase the original shock effect to two-and-a-half times the size.”
Germany is the largest consumer of Russian gas in Europe and an important transit country through which gas supplies to Europe take place via the Nord Stream gas pipeline and others. In 2021, Germany imported about 35% of its oil, 55% of its natural gas and about half of its coal from Russia.