German authorities are trying to establish what caused a sudden drop in pressure in the old Nord Stream 2 gas pipeline, with a spokesman for its operator saying it could be a leak.
The pipeline has been one of the flashpoints in the escalating energy war between Europe and Moscow since Russia’s invasion of Ukraine in February, which hit Western economies and sent oil prices skyrocketing. gas price.
The operator of Nord Stream 2 said pressure in the undersea pipeline fell from 105 to 7 bar overnight.
The Russian-owned gas pipeline, which was to double the volume of gas flowing from Vyborg, Russia, under the Baltic Sea to Germany, had just been completed and filled with 300 million cubic meters of gas when the German Chancellor, Olaf Scholz, canceled it. shortly before Russia invaded Ukraine.
European countries have resisted Russian calls to allow Nord Stream 2 to operate and have accused Moscow of using the energy as a weapon. Russia denies doing so and blames the West for the gas shortages.
“We are currently in contact with the authorities concerned to clarify the situation. We still do not have clarity on the causes and the exact facts,” said a statement from the German economy ministry.
The Swiss pipeline operator, which has been legally liquidated, said it informed all the relevant authorities and that the leak, if that was the cause, could not have taken place at the landing point of Lubmin, in the north of Germany. “If it was in Lubmin, you would have heard it,” the spokesperson said.
Gazprom referred questions about the incident to operator Nord Stream 2.
Germany has informed the Danish authorities of the incident and is trying to establish whether the pressure drop occurred in German waters. The Danish authorities have asked the ships to move away from a radius of five nautical miles off the island of Bornholm.
Russia has cut gas supplies to several countries and halted flows through the Nord Stream 1 gas pipeline under the Baltic Sea, blaming Western sanctions for hampering operations.
The alleged leak had no immediate impact on the gas trade as signs indicate Vladimir Putin’s efforts to disrupt energy supplies in Europe this winter will be thwarted.
The price of UK wholesale gas for delivery this weekend fell nearly 24% to 160p therme on Monday, with the price for Tuesday delivery down 17% to 190p therme.
Prices have fallen in recent weeks as Europe made progress in filling storage facilities for this winter and intervened in the energy market to protect consumers.
The daily price has fallen sharply from the 589p per therm seen a month ago after Russia’s Gazprom began throttling flows through the key Nord Stream 1 pipeline.
Asked about the potential Nord Stream 2 leak, Tom Marzec-Manser, head of gas analysis at Independent Commodity Intelligence Services, said: “In terms of European supply, no one in the market seriously thinks it could become operational and a route to the Russian gas market, so this should not affect the price. It’s not a lost supply route, it’s a lost white elephant.
Analysts said the fall in prices was due to a combination of factors, including progress in filling storage facilities. Prices also fell due to an increase in wind power production and signs that routine annual maintenance of Norwegian gas fields went according to plan without requiring further outages.
Marzec-Maser said: “The fact that wind generation has started and there is plenty of wind power across the continent has eased the pressure on the amount of gas-fired generation required, especially given the issues to hydroelectricity and nuclear power.
Low water levels in southern Norway have disrupted hydroelectric power supplies, while French nuclear power plants have encountered problems, including rising water temperatures in rivers.
Marzec-Maser said concerns remained about how Europe would be supplied next year when storage facilities are likely to be empty and Russian gas is potentially unavailable, unlike earlier this year when efforts to import more gas started.
Falling wholesale gas prices are expected to reduce the cost to the UK government of capping energy bills. The government has set a limit of £2,500 on average household bills, a policy that could cost more than £100billion.