Russia’s Gazprom says gas flow to Europe will be shut down after G7 deal to cap prices to strangle Putin’s war machine | World News
Russia’s Gazprom said that natural gas supplies to Europe through the Nord Stream 1 pipeline will continue to be shut down.
It comes after G7 finance ministers agreed to impose price caps on Russian oil exports in an attempt to limit funding for President Vladimir Putin’s war in Ukraine.
Gazprom said it was not restoring supplies to Europe because the main gas turbine at the Portovaya compressor station near St Petersburg could not operate safely until a leak had been repaired. It does not indicate when the supply will be restarted.
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Moscow has blamed sanctions imposed by the West after Russia’s invasion of Ukraine for hindering the regular operation and maintenance of Nord Stream 1. However, Brussels argues that is an excuse and Russia is using it. gas as an economic weapon of retaliation.
European Council President Charles Michel tweeted: “Gazprom’s move is not surprising. The use of gas as a weapon will not change the resolve of the EU.
“We will accelerate the path towards energy independence. It is our duty to protect our citizens and support the freedoms of #Ukraine @ZelenskyyUa”
The European Commission’s chief spokesman, Eric Mamer, tweeted: “Gazprom’s announcement this afternoon that they are once again shutting down North Stream 1 under the pretext of fallacy is yet another confirmation of the unreliability of the European Commission. them as suppliers.
“It is also proof of Russia’s ridicule, because it prefers gas flares instead of honoring contracts.”
Germany’s network regulator said the country was better prepared for the shutdown of Russian gas supplies, but urged people and companies to cut consumption.
“According to Russia’s decision for the time being not to allow any gas to flow through Nord Stream 1, the LNG terminals,
Klaus Mueller, president of the Bundesnetzagentur, tweeted.
The Nord Stream 1 gas leak incident that Gazprom said was in one of the engines at the Portovaya compressor station. Photo: Gazprom
The G7’s decision was made at a virtual meeting of the group of seven of the world’s richest countries – Britain, the US, Canada, Italy, France, Germany and Japan – on Friday afternoon.
Confirming the information, Prime Minister Nadhim Zahawi said: “We will cut his ability to finance his war from Putin’s oil exports by banning services, such as insurance and supply. financing, for Russian tankers above the agreed price”.
The price cap is yet to be decided.
Ukrainian President Volodymyr Zelenskyy said: “Such energy sanctions against Russia are long overdue. Sanctions will not only limit the flow of euro oil and gas dollars to Moscow. but also importantly restore justice to all Europeans, whom Russia is trying to blackmail with artificially inflated prices on the energy market.”
Prime Minister Nadhim Zahawi
A statement from G7 finance ministers said it would be set up by the full coalition before it was implemented in each country.
Despite selling less oil since its invasion of Ukraine in February, Russia made £600m more from oil sales in June than it did the previous month due to soaring prices due to the war.
In addition to limiting Russia’s revenue, it is expected that the price ceiling could also reduce rising energy prices around the world.
Speaking after the announcement, Mr Zahawi said the move would “protect our citizens from oil price shocks in the coming year”.
“It’s a significant step forward,” he added.
“That means Putin cannot profit from excessively high oil prices and, of course, protects us all from oil price shocks next year and beyond.”
‘Putin’s strategy won’t work’
The G7 decision came after Mr Zahawi met Finance Minister Janet Yellen in Washington on Wednesday to discuss how to tackle the growing cost of living crisis.
Sky News understands that the meeting is important in getting the two countries over the price cap.
Mr Zahawi said G7 ministers would discuss strategies to implement the cap in December, then deliver it in February.
Energy bills will soar for millions of UK households before, after Ofgem raised the price ceiling in October to 80% – many people fall into financial hardship.
A hero wish list is still very short in detail
The G7 nations and the EU have announced they will reduce or cut their imports of Russian oil and gas.
The “price cap” announced today by G7 finance ministers is an attempt to further strangle Moscow’s fossil fuel revenue, by targeting service companies that provide energy administrative and logistical architecture for the oil trade.
The G7 said service providers would be barred from “allowing the shipping” of crude oil and petroleum products if they were trading above the unspecified limit.
This announcement does not specify any services, but we can assume that shipping, transport, insurance, financial and commercial companies, many of which are based in the EU, USA, Great Britain and Switzerland, in the sights of finance ministers.
According to Prime Minister Nadhim Zahawi, the goal is to cut Moscow’s oil revenues, while protecting low- and middle-income countries that still depend on Russian imports, and insulate British consumers from the future price shocks.
It was a heroic wish list but still a theoretical one and very short in detail. The announcement only signals “intention to finalize and implement” a plan and it is unclear how it will be implemented.
What is clear is that the current measures to limit dependence on fossil fuels do not affect the Kremlin’s revenue as much as hoped.
Even as Russia’s oil exports fall, higher global prices caused by the war mean increased revenues. Research by the Center for Energy and Clean Air shows that sales increased in July due to a 6% drop in exports.
And while Western buyers are turning away, India and China are continuing to stagnate, while Beijing now depends on Moscow for almost 25% of its oil imports.
Today’s G7 move is an acknowledgment that Russia’s strategic weaponization of fossil fuels has so far been a win-win.
While European consumers are hit by higher bills, which in turn could undermine support for Ukraine, Moscow is still making money.
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Mr. Zahawi acknowledged people needed help sooner when the limit on Russian oil went into effect.
He said he was “very concerned about the effect of scarring on businesses” and that the government was “working on options” so that the next prime minister, who will be named on Monday, could “command”. start running so we can provide more help in January and into next year.”
Mr. Zahawi added: “Putin has to know that this strategy won’t work. He thinks that actually using energy as a tool to get us back will work… It won’t work.
“And in fact, today’s G7 is another reminder to him why we will work together and together we will tackle these energy price shocks and will continue to help Ukraine win back.” their country.”
