shine trader live reports:
Russia hinted that it would not do its best to provide additional natural gas to Europe to alleviate the current energy crisis unless Russia received some return: regulators approved the transportation of natural gas through Beixi No. 2 pipeline.
Bloomberg News quoted people familiar with the matter – people close to natural gas giant Gazprom and the Kremlin as saying that Russia wants everyone to know that Europe needs to exchange with Russia in exchange for increased natural gas supply – Beixi 2 was approved by Germany and the European Union.
Last week, Russian President Vladimir Putin said at the energy conference that Russia could provide more natural gas, but he also regretted the slow progress of the approval of Beixi 2 project: “if we can increase (natural gas) through this route Delivery volume, which will greatly ease the tension in the European energy market. However, due to administrative obstacles, we can’t do this at present. ”
Konstantin kosachyov, a member of the upper house of the pro Russian government, said recently, “we can’t just rescue the emergency and make up for the mistakes we didn’t make. We are fulfilling all contracts and obligations. Everything else should be voluntary or reciprocal.”
Beixi 2 passes through the Baltic Sea, Ukraine and Poland from Vyborg, Russia, to lubmin, Germany, with a total length of 1200 kilometers. The natural gas pipeline has been completed, but it is still waiting for regulatory approval before it can start supplying 55 billion cubic meters of natural gas to Europe every year. On Monday, Beixi No. 2 pipeline said that its first production line could be ready to start operation, but it could not be transported until it was approved by the regulatory authorities.
A few hours before the announcement of Beixi No. 2, it was reported that Gazprom once again only bid for a small amount of transportation capacity, limiting the natural gas transported to Europe through other routes, which made the natural gas price soar again on that day. According to the data of Oxford Energy Research Institute, although Russia’s exports to Europe this year have increased from the lowest level last year, they still lag behind the level in 2019. In October, the daily transportation flow decreased, and the replenishment speed of Gazprom’s storage facilities in Europe was slow, which increased the upward pressure on prices.
At present, the price of natural gas in Europe is more than five times higher than a year ago. The soaring fuel cost has an increasingly serious negative impact on the European economy. If energy prices do not plummet, or do not plummet soon, Europe will face increasing pressure to find natural gas at all costs. As for Russia, as long as it abides by the contract, if it is willing to give up the marginal profit of additional natural gas exports, it is entirely its own decision.
Russian gas is seen as the main way for Europe to avoid a more serious supply shortage in winter. The mainstream public opinion in Europe attributed the lack of gas to Russia, believed that this year’s gas shortage in Europe was mainly “intentional” by Russia, and called on Russia to increase the sale of natural gas. Russia blamed the European energy crisis on its hasty shift to relying on the spot market and new energy.
At present, the approval of Beixi No. 2 project will last until next year. German regulators are currently reviewing the certification application for this project, but said their preliminary decision can only be made in January, and then need to be approved by the European Commission. Although Gustav gressel, a senior policy researcher at the European Council on foreign relations, previously said that it was only a matter of time before the German energy regulator approved the plan, analysts said that it was not easy, and the important obstacles were as follows:
1. The United States has always opposed this pipeline, saying it has increased Europe’s dependence on Russian energy.
2. Poland and Ukraine oppose the pipeline on the grounds of energy security. They worry that the pipeline may reduce the flow of natural gas sent to Europe through the Ukrainian pipeline.
3. Critics believe that this pipeline is not in line with Europe’s climate goals and is likely to enhance Russian President Vladimir Putin’s economic and political influence in the region.
Zerohedge, a financial blog, commented that excellent Russian lawyers can find all loopholes to transport much less natural gas than before in compliance with the terms of the contract. In addition, if Europe is “frozen” this winter, no one can blame it except itself.