Summary
- Germans, Dutch try to solve EU impasse
- Vladimir Putin says Russia is not responsible for soaring energy prices
- Oil pipe leak in Poland seen as accident
- Britain acts to limit gains of low-carbon producers
Russia’s president Vladimir Putin said Europe was responsible for its energy crisis with policies that deprived the oil and gas industry of investment and said price caps would aggravate the situation, as EU nations attempted to strike a deal on ways to curb surging energy prices.
Worries about the security of energy supplies were exacerbated on Wednesday when a leak in Poland on the Druzhba pipeline from Russia minimized the flow of oil to Germany.
Poland said the leak was possibly caused by an accident but it came as European Union states are trying to stop their reliance on Russian energy in response to Moscow sending its troops into Ukraine in February.
The Nord Stream gas link to Germany is currently not functioning after a leak in September that both Russia and the West have blamed on sabotage, without determining who was behind it.
President Vladimir Putin said leaks in the two Nord Stream pipelines running under the Baltic Sea were an “act of international terrorism” to prevent people from accessing cheap energy. Putin said gas could still be delivered by one undamaged part of the Nord Stream 2 pipeline but it was up to the EU whether it needed the gas or not.
Germany suspended the Nord Stream 2 project days before Russia invaded Ukraine and a German government spokesperson on Wednesday turned down taking gas via that route. Putin also put forward the idea of setting up an alternative European gas hub via Turkey.
Putin told an energy forum in Russia:
“We could move the lost volumes along the Nord Streams along the bottom of the Baltic Sea to the Black Sea region and thus make the main routes for the supply of our fuel, our natural gas to Europe through Turkey. That is, of course, if our partners are interested in this. And economic feasibility, of course.”
Putin said Moscow was not to responsible for Europe’s soaring energy prices and mentioned the EU’s green energy drive, saying it caused underinvestment in the global oil and gas industry.
The Group of Seven (G7) nations have been considering a cap on Russian oil prices, a move Putin said would heighten problems.
The impact of efforts to consume less Russian energy, plus sharp cuts in deliveries from Russia, have been experienced across the 27-nation EU, with gas prices almost 90% higher compared to a year ago and fears of power cuts and rationing over the coming winter.
Vladimir Putin Discussed In Prague Talks
EU energy ministers were meeting in Prague on Wednesday to try to decide on new measures to deal with the crisis. Many EU countries say they want a gas price cap, but clash over its design. Some countries, including Germany, Europe’s largest gas market, remain against it, maintaining it risks choking off supplies.
Germany and the Netherlands floated their own proposals before Wednesday’s meeting in the Czech capital – proposed 10 “no-regret” EU measures, including tougher targets to save gas, a new benchmark price for liquefied natural gas, and negotiating lower prices with other suppliers, such as Norway.
In neighboring Poland, pipeline operator PERN said a leak was found on Tuesday evening in a section of the Druzhba oil pipe about 70 kilometres (43 miles) from the central Polish city of Plock.
The Druzhba pipeline, whose name stands for “friendship” in Russian, is one of the world’s biggest, delivering Russian oil to much of central Europe.
“Here we can talk about accidental damage,” Poland’s top official in charge of energy infrastructure Mateusz Berger told Reuters by telephone.
Germany’s PCK Refinery in the eastern town of Schwedt, which provides 90% of Berlin’s fuel, said it was still taking oil supplies from the Druzhba pipeline but at a lower capacity.
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The energy crisis has had knock-on effects across the whole of Europe as businesses have transferred extra costs, squeezing household budgets. Governments are also attempting to work out how to fund emergency measures taken to cushion customers and reduce the distortions caused by the rise in prices.
EU member Portugal intends to inject 3 billion euros ($2.9 billion) into its natural gas and electricity systems to limit prices paid by companies in 2023, the government said on Wednesday. In Britain, the new government laid out plans for a temporary revenue cap on low-carbon electricity generators, which the industry said was a “de-facto windfall tax” on renewable energy producers.
Surging gas prices across Britain and Europe have pushed up the cost of electricity.
