Gazprom is slowly launching an oil boom in Europe

Russian state gas group Gazprom has begun to fill its European reservoir with the first sign of plans to fulfill President Vladimir Putin’s promise to help end the power crisis in the country.

Gazprom on Tuesday said it had “determined the quantity and capacity of gas transport” in four locations in Germany and Austria, without adding others.

Putin has promised that the company this week will start filling up some of the existing storage facilities in Europe after leaving too much oil there.

The move is the first sign that Russia could lift goods in western Europe as rising gas prices have put the region at risk of serious power shortages. Other European lawmakers say the crisis is slowing down Moscow’s economy.

Global global demand, declining wind power and rising natural gas in Asia have left European consumers expecting help from Russia, which supplies 40 percent of the continent’s gas.

But the markets reacted strongly when it was discovered that Russia could not increase its volume enough to allay concerns that even a slightly cooler climate than expected could lead to a reduction in gas emissions in Europe.

The European benchmark index fell by only 1 percent in daytime sales on Tuesday to € 77.75 per hour megawatts, while the UK bond deal for December fell by about 3 percent to $ 1.97 per therm.

Prices plummeted later in the day after Gazprom seized additional pipelines through Ukraine, allowing it to boost exports on Wednesday, albeit still low.

“The market needs to assume that these reserves continue,” James Huckstep told S&P Global Platts.

Some analysts agreed that there was no need to warn, with Russia’s exports to western Europe lower than last year.

“It’s a starting point, but the volumes are provided [from Gazprom] At the moment it is difficult and not enough to lower prices, “said Tom Marzec-Manser at ICIS, a consultant.

“In both the Polish and Ukrainian routes, Gazprom still offers the lowest amount of savings – sending the lowest in September and October but not around 2020 or 2019.”

Putin has ordered Gazprom to begin filling its European warehouse by the end of this week’s Russian stockpile. But the president has said that any other gas should come through the crisis Nord Stream 2 pipeline, which passes through traditional channels through Ukraine to allow Germany across the Baltic Sea.

Moscow has rejected claims by some European policymakers that Gazprom is exacerbating the gas crisis by reducing the volume of exports to speed up pipeline approval, which is not expected by the end of the first year.

Sergiy Makogon, Ukraine’s chief of Gas Transmission System Operator in Ukraine, said Gazprom maintained an additional 20m cubic meters per day of pipeline through Ukraine, taking all items up to about 110 cubic meters per day. But the increase in volume was not close to the required level, he added.

“The same figure last year was about 180 cubic meters per day and 2020 was the year of the Cowid drought in Europe,” Makogon said. “Now we want more, cheaper, cheaper storage, but that amount is half of what it used to be.”

Gazprom has eight museums in Europe outside of Russia, including four in Germany – Jemgum, Katharina, Rehden and Etzel – and one in Austria, Haidach.

Mitch Jennings, an oil and gas expert at Sova Capital, said the data to be released in the next few days would show whether Gazprom deliberately blocked gas by disclosing the amount of energy the state-owned electricity company had stored.

Data from Gas Infrastructure Europe shows that as of November 7, storage in Rehden, Germany, was very low – only 9.6 percent.

Jennings estimates that filling Haidach, Jemgum and Katharina areas would require about 9.2bn cubic meters, while Rehden would require about 40bn cubic meters. “Obviously Rehden won’t fill up this year,” he said.

Additional reports of Nastassia Astrasheuskaya in Moscow