France accuses Russia over gas supply as Nord Stream shutdown looms

By Dominique Vidalon

PARIS (Reuters) -France accused Moscow on Tuesday of utilizing power provides as “a weapon of battle” after Russia’s Gazprom minimize deliveries to a significant French buyer and mentioned it might shut its primary gasoline pipeline to Germany for 3 days this week.

European governments try to coordinate a response to hovering power prices for companies and households and to fill storage amenities forward of peak demand within the winter.

Western nations concern that Moscow is intentionally driving up gasoline costs to attempt to weaken their opposition to its invasion of Ukraine, a tactic Ukrainian President Volodymyr Zelenskiy on Monday dubbed “financial terrorism”. Moscow denies the cost.

Nord Stream 1, the principle conduit for Russian gasoline into Europe, has grow to be a flash level within the dispute. Europe faces an additional squeeze on provides this week as Gazprom shuts off the pipeline for upkeep from Wednesday until the early hours of Saturday.

Kremlin spokesman Dmitry Peskov mentioned on Tuesday technological issues attributable to Western sanctions on Russia are the one factor standing in the best way of supplying gasoline through Nord Stream 1.

However France’s Power Transition Minister Agnes Pannier-Runacher mentioned: “Very clearly Russia is utilizing gasoline as a weapon of battle and we should put together for the worst case state of affairs of an entire interruption of provides.”

She was chatting with France Inter radio after French utility Engie mentioned it might obtain much less gasoline from Gazprom from Tuesday due to an unspecified contractual dispute.

Russia has been pumping gasoline through Nord Stream 1 at solely 20% of capability and there are fears that this week’s outage could possibly be prolonged.

Requested if there are ensures that Gazprom will restart gasoline flows through Nord Stream 1, the Kremlin’s Peskov mentioned: “There are ensures that, aside from technological issues attributable to sanctions, nothing hinders the provides.”

‘INSANE PRICES’

EU power ministers will maintain an emergency assembly on Sept. 9 to debate the disaster.

Germany, Europe’s largest economic system, is open to discussing a price-cap scheme on gasoline provides at a European stage, a supply in Italy mentioned, citing a textual content message Germany’s economic system minister despatched to his colleagues throughout the bloc.

The supply mentioned Robert Habeck despatched a message to EU power ministers flagging that Berlin was open to debate the worth cap at subsequent week’s assembly.

Italian Prime Minister Mario Draghi has been pushing for a worth cap, and has additionally known as for steps to decouple the price of electrical energy from the gasoline worth. Such a transfer would permit European households to get the advantages from electrical energy produced from cheaper sources reminiscent of renewables.

The chief government of German power agency Wintershall Dea mentioned on Tuesday that present worth ranges meant demand for gasoline would fall in the long run.

“The costs we’re having at present are insane. That’s nothing even a gasoline producer is on the lookout for as a result of in the long run, we’re going to massively destroy demand for our product,” Mario Mehren instructed reporters on the sidelines of a convention in Norway.

Benchmark Dutch wholesale gasoline costs rose on Tuesday afternoon after an preliminary retreat. The front-month gasoline contract was up 1.5% at 271 euros/MWh, off all-time highs hit final week however nonetheless buying and selling at ranges greater than 5 instances these seen a yr in the past.

(Reporting by Dominique Vidalon and Richard Lough in Paris, Giuseppe Fonte in Rome, Federico Maccioni in Milan, Holger Hansen in Berlin, Susanna Twidale in London, Vera Eckert in Frankfurt and Nora Buli in StavangerWriting by Keith Weir; modifying by Jason Neely, Angus MacSwan and Gareth Jones)