X

This is not a paywall.

Register for free to continue reading.

The news sucks. But your reading experience doesn't have to. Help us improve that for you by registering for free.



Please create a password or click to receive a login link.


Please enter your password or get a login link if you’ve forgotten


Open Sesame! Thanks for registering.

First Thing, Daily Maverick's flagship newsletter

Join the 230 000 South Africans who read First Thing newsletter.

A South African Hero: You

There’s a 99.7% chance that this isn’t for you. Only 0.3% of our readers have responded to this call for action.

Those 0.3% of our readers are our hidden heroes, who are fuelling our work and impacting the lives of every South African in doing so. They’re the people who contribute to keep Daily Maverick free for all, including you.

We need so many more of our readers to join them. The equation is quite simple: the more members we have, the more reporting and investigations we can do, and the greater the impact on the country. We are inundated with tip-offs; we know where to look and what to do with the information when we have it – we just need the means to help us keep doing this work.

Be part of that 0.3%. Be a Maverick. Be a Maverick Insider.

Support Daily Maverick→
Payment options

Gazprom Declares Force Majeure on Some European Gas Buy...

Business Maverick

Business Maverick

Gazprom Declares Force Majeure on Some European Gas Buyers

A worker inspects a gas collection point of the Kasimovskoye underground gas storage facility, operated by Gazprom PJSC, in Kasimov, Russia, on Wednesday, Nov. 17, 2021. Russia signaled it has little appetite for increasing the natural gas it transits through other territories to Europe as the winter heating season gets underway.
By Bloomberg
18 Jul 2022 0

Gazprom PJSC declared force majeure on at least three European gas buyers, a move that may signal it intends to keep supplies capped, according to people familiar with the matter.

The Russian gas giant — which had already been curbing exports to Europe and closed its main pipeline for maintenance earlier this month — said in a letter dated July 14 that the legal clause applied to supplies over the past month, said the people, who asked not to be identified because the information is private.

Gazprom has been delivering less gas than ordered by customers over the past month, with the company citing problems with turbines at its main pipeline to Europe that ends in Germany. Flows via Ukraine have also declined since one of two main entry points on the border with Russia was shut due to the war.

It “does feel like a signal that the low flows could continue for longer than just the scheduled maintenance period,” said Trevor Sikorski, head of natural gas, coal and carbon at Energy Aspects Ltd.

Companies usually declare force majeure when an unforeseen event like a fire or natural disaster prevents them from complying with contracts. Triggering the legal cause retroactively is “unusual to say the least,” Sikorski said, adding that he expected European buyers to dispute the notice and seek compensation.

Reuters reported the move earlier. Gazprom had no immediate comment. Uniper SE has formally rejected Gazprom’s declaration, saying the claim is unjustified, Handelsblatt reported, citing a Uniper spokesman.

Russian gas exports to Europe via Ukraine started declining in May, when one of the main entry points was closed to ensure safety after forces invaded a key compressor station. Shipments were curbed further last month, with Gazprom citing technical issues with gas turbines, one of which was stranded in Canada following repairs due to sanctions.

While Canada has said it will release the part, the move may signal that there’s no chance of the turbine being returned before July 21, when the Nord Stream pipeline is set to start operating again, said Jonathan Stern, a researcher at the Oxford Institute for Energy Studies.

“It may also be that the Russian government is happy to increase the pressure on Europe and is using this technical situation as a pretext for not resuming flows,” he said.

Gazprom doesn’t disclose terms of its contracts, but most of its long-term agreements in Europe normally have minimal volumes and maximum volumes it’s obliged to deliver — per month, a quarter and over a year. European gas prices were little changed.


Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

No Comments, yet

Please peer review 3 community comments before your comment can be posted