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Russia Is Slowly Turning The NatGas Tap Off To Europe
While Naftogaz (Ukraine's gas pipeline operator) states that all gas transportation from Russia to Europe is running normally, Bloomberg reports that Russian natgas exports to Europe are declining. Shipments are down over 4% from the prior week and also lower to Ukraine. This 'adjustment' follows increased sanctions by the West as Medvedev's notable statement this morning that Ukraine owes Russia $16bn.
NatGas output is tumbling
The good news:
Gazprom today said natgas transit to Europe via Ukraine, supplies for Ukrainian consumption
But Pay Up...
Ukraine owes Russia $11b after collapse of 2010 deal, Russian Prime Minsiter Dmitry Medvedev says to President Vladimir Putin at Security Council meeting, according to transcript on Kremlin website.
Medvedev adds $3b Ukraine bonds bought in Dec., ~$2b debt to Gazprom for natgas supplies
NOTE: In 2010, Russia agreed to sell natgas at discount in exchange for extending lease to Black Sea naval port of Sevastopol in Crimea to 2042 from 2017
Or Else...
Russian natgas exports to Europe and Turkey, excl. former Soviet Union, declined to 405.3mcm as of March 22, according to Bloomberg calculations based on preliminary data from Energy Ministry’s CDU-TEK unit.
Avg daily exports to region were ~457mcm in March, lower than yr earlier: calculations based on CDU-TEK data
Shipments March 16-22 were 3.04bcm, 4% decrease vs level in week ended March 15
It is too early to see a trend, but for now, the direction is not hopeful for Europe.
Furthermore, Gazprom has cut its Diesel output by the most in 7 months...
and then... (via NY Times),
Russia is now asking close to $500 for 1,000 cubic meters of gas, the standard unit for gas trade in Europe, which is a price about a third higher than what Russia’s gas company, Gazprom, charges clients elsewhere.
Russia says the increase is justified because it seized control of the Crimean Peninsula, where its Black Sea naval fleet is stationed, ending the need to pay rent for the Sevastopol base. The base rent had been paid in the form of a $100 per 1,000 cubic meter discount on natural gas for Ukraine’s national energy company, Naftogaz.
And if that's not clear enough...
Of course, not every country is as exposed as the chart above shows, however, as Reuters shows below, EU's eastern members depend very heavily on Russia...
Below are details of how some of the ex-Communist EU states are economically exposed to Russia:
BULGARIA
Imports from Russia accounted for 18.5 percent of Bulgaria's total imports last year, worth about $6.6 billion. Russia is Bulgaria's biggest source of imports.
Energy is the main import from Russia. Bulgaria gets about 90 percent of its gas from Russian firm Gazprom. Its only oil refinery, controlled by Russia's LUKOIL, works on Russian crude and its only nuclear power plant, which provides over 40 percent of electricity, operates two 1,000 MW Soviet-built reactors that work on Russian nuclear fuel.
Last year some 700,000 Russians were among Bulgaria's 2.6 million tourists. Tourism revenue makes up about 13 percent of annual gross domestic product.
CZECH REPUBLIC
In 2012, the latest year for which figures are available, 66 percent of Czech imports of natural gas came from Russia.
Exports to Russia in 2013 were worth $5.83 billion, and represented 3.67 percent of total exports. Imports from Russia were worth $7.80 billion.
Russia's largest steelmaker Evraz has a plant in the Czech Republic.
A consortium including Russia's Atomstroyexport is competing in a multi-billion dollar tender to expand the Temelin nuclear power plant. Russian firm TVEL supplies CEZ nuclear power units with fuel.
In 2013, Russians accounted for the second largest group of tourists coming to the Czech Republic with 759,000 people, or 10.4 percent of total tourists.
HUNGARY
Russia is Hungary's largest non-EU trading partner. Exports to Russia last year were worth 2.55 billion euros ($3.5 billion), of total exports worth 81.7 billion euros.
Hungary imports about 80 percent of its gas needs from Russia.
The government has signed an agreement with Russia's Rosatom to expand the Paks nuclear power plant that supplies about 40 percent of Hungary's electricity.
Russia is Hungarian drug maker Richter's biggest market. The company has warned first quarter profit will fall due to the rouble's slide.
LITHUANIA
About one fifth of Lithuanian exports go to Russia, though a large part of this is "re-exports," meaning that Lithuanians are importing the goods from a third country and then shipping them on to Russia.
* Lithuania and its industry are almost totally reliant on Russia for energy resources.
POLAND
Russia accounts for 90 percent of Poland's oil imports and more than half of its gas.
Russia is Poland's second largest trade partner, with combined 2013 imports and exports accounting for 8.8 percent of foreign trade, worth $36 billion.ROMANIA
Romania's exports to Russia totalled 1.3 billion euros ($1.8 billion) in the first 11 months of 2013 or 2.8 percent of overall exports. Romanian imports from Russia were 2.1 billion euros in January-November 2013, representing 4.2 percent of total imports.
Romania is much less dependent on imported gas than other countries in the region. Romanian gas fields provide about 80 percent of domestic needs, and President Traian Basescu said that if Russia cuts gas deliveries, the effects will not be substantial.
SLOVAKIA
Exports to Russia in 2013 were worth 2.55 billion euros ($3.5 billion), or 3.96 percent of total exports. Imports from Russia were worth 6.15 billion euros ($8.5 billion)
Fuel for two nuclear power plants is imported from Russia. Russian firm Rosatom has been in talks to take part in constructing new nuclear power units in Slovakia.
Slovakia is nearly 100 percent reliant on Russian gas, and its budget revenues depend on the tariffs it charges for Russian gas crossing its territory.
SLOVENIA
Slovenia is among the EU countries with the largest surplus in trade with Russia. It exports some 1 billion euros of goods and services to Russia per year, about 4.6 pct of total exports.
For Slovenia's largest listed company, pharmaceutical firm Krka, Russia is the biggest single market. Krka has a factory in Russia and last year sold products worth 300 million euros ($413.5 million) to Russia, a quarter of its total sales.
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All this will come to a head when China and Russia announce their total gold holdings. Goodbye petrodollar -- thus automatically imploding any plans the West may have for further threats and fomentations. One rumor I encountered claims this will occur on April 24. In any event, and regardless of when, this is all they need to do when push really comes to shove. My prediction is for a more or less bloodless WWIII before the year is through.
I hope you're right.History says very differently though.
We will know very shortly though.The foreplay is just about over.
My sense is they will do this rather than mobilize into the Ukraine. It's a far more elegant and powerful solution; not to mention cheaper. Judo vs. blunt force, etc.
Also, I think perhaps this period may be historically unique on a number of levels. At no time before that I can think of has the enemy ( that would be us ) become such a hollowed out house of cards that he could be blown away with just the tiniest puff to the solar plexus.
Let's hope that Russia with China break the petrodollar ! It's high time that this happens.
'Bloodless WWIII' - good one - yes, it shouldn't be a problem to juggle a hundred marbles, knifes, flaming torches and bowling balls when the time comes, how could anything possibly get out of hand?
If there is no blood, it isn't a war, just politics as usual.
I say they announce on May Day... just for the irony... ;-)
wasn't it the case that the europe went through unusually mild winter and natural gas demand was at neat all time low?
Weeee don't neeeed your stinkin gas!
We will freeze democratically!!!
They don't appear to need elections, either.
the world is slowing. china is slowing and i think that is all I need to know. i recall 08 when the whole complex collapsed to 43/bbl. so, tell me why we aren't headed in the same direction? what 87m bbl/day.2 million extra starts backing up the supply chain fast. i see 70-80 by summer end and a whole lotta strife world wide....
That is the subtle horror of oil scarcity.
You won't like what the world looks like should the price fall to $70/barrel, because that disaster will be the cause of the fall.
Oil produiction decline should be pretty much symmetrical to oil production increase in the past, right?
So global oil production in 2035 should be similar to global oil production in 1975.
Who knows, maybe over the next couple years people will accept reality and begin making changes to adapt.
oh what a surprise... Thank you Nuland.
I'm now going to have to go price up a ground source heatpump, thermal stores, extra insulation etc. All stuff that has high capital cost and historically looong payback period.
Exactly ! Nuland outed herself in being a part of what has happened in the Ukraine. Shame on the U.S. for causing the Ukraine mess !
A new leaked tape: Yulia Tymoschenko wants to nuke Russians. This shit is gettin so dangerously out of hand that it can get us all killed..
http://rt.com/news/tymoshenko-calls-destroy-russia-917/
Relax, Ukraine doesn't (at least officially) actually have nuclear weapons, so it is (probably) an empty threat. Like Rob Ford threatening to gouge some guy's eyes out. Tough guy politicians talking crap to their buddies, not aware they are being recorded.
Where is she going to get nukes?!?
They coughed them all up 15 years ago when the US and Russia promised to guarantee Ukraine's soveriegnty
At first, I thought surrendering their nukes was a terrible idea.
Now, I sure am glad they don't have them. The last thing we need are nuts with nukes.
Double post
Dude, where are you living?, there are lots of nuts with nukes out there. !
Not ones calling for a nuclear strike against an ethnic minority within their own country.
Benjy will give her a few. No one knows how many Benjy has in the first place.
Whether the mindless warmongers in Washington, London, Berlin and Brussels ignored that Russia's gas supplies to Europe would become a centrepiece of friction between the two sides over Ukraine, or whether it was always exactly what they intended, to start a new Cold War -- or even a Hot War -- to distract domestic attention away from their disastrous economies run by criminal banksters and to justify stealing citizens bank accounts, we will probably never know. But it sure looks like it's happening anyway. This could get very nasty, very quickly.
Europe may have to resort to UN-natural gas...EEEEUUUUUUUU!
Ah, a blast from the past. If Germany (and other EU countries) can just find a way to harness the methane of their flatulent cows....
http://www.dailymail.co.uk/news/article-2547492/Flatulent-cows-cause-methane-explosion-German-dairy-farm-nearly-takes-entire-barn-roof.html
Likely blast from the backz.
Not much fun, really. Even less warm.
Flatulate EU! bitchez. Rumpuy it!
Talking large gaseous amounts, is it a stretch to use the Hindenburg as a metaphor for the EU? Perhaps it's a blimp in search of a spark?
Just as Ronald Reagan warned would happen.
Is demand down?
Once again the peons will take the hit while the likes of Merkel sit there with a butter stained dress and 55 gallon drum of half ate 75lb lobster claws throwing her dog the entire tail and looking down at people sleeping on the fucking street under trashbags and wondering why they don't get their lazy ass up and do something.
Lay off the Beer and the drugs, will you ? This is not the reality.
Damn straight. I bet those dogs don't get anything better than a claw here & there. Pre-cracked, of course - one must be civilized.
Lithuania and Poland had better mind their manners toward Russia.
And Germany had better get ready for paying more, or paying in Gold For Gas. GOD = Gold On Delivery.
Europe and Russia are in bed with each other......and they both are getting off, and loving it ! The U.S. will not change this relationship. Sorry!
At the end of this year Lithuania will have LNG terminal which is enough for all country needs so numbers showed here will change. Besides pipes to Kaliningrad goes through Lithuania so russians can't really close it down completely. Anyway fuck russia and their threats better die than be not free...
Putin is probably preventing the EU from storing excess supply.
The illusion of dependency is just that. The E.U. is doing better than the U.S. MSM wants to report on. Why ? to divert attention on how bad it is at home. Sorry.
History repeats, it always does. Some stupid fuck called the "end of history" back in the 90's. That was pure stupid, but we have a lot of that in Washington, the whore house, DC!
Wrong time for Michelle Obama to scold China. Old buddy Putin is sitting outside the door waiting to offer abundant energy.
China can just flip the last first lady the middle finger and see Russia. Leaving Europe to freeze while Putin is laughing.
What first Lady?
Rumour going around she is a transvestite.
Good news for shale gas companies. They can't wait to exploit the gas fields in Poland and other places. Well, there goes the environment.
The EU simply did not move away from Russian gas fast enough after the warning they got after the events in Georgia of 2008 that they are too dependent on Russian gas.
UPDATE: Obama convinces G8 to become G7 and officially throw Putin out of their clubhouse. Let's see what tomorrow brings.
Russians will soon be holidaying in the Far East.
Tourism to Western and Southern Europe will be hit more
More pain to Spain and the French will be happy that they can chase more of their own floosies .
As for Russia being suspended from the G8, The world will soon see the new G4, Russia, China, India & Brazil.
The G7 are anyway bankrupt.
Gosh, no more Russians in western Europe? What a relieve.