Russian President Vladimir Putin ordered the state-controlled energy giant Gazprom to rebuild European natural gas inventories next month.
President Vladimir Putin told Gazprom to switch to replenishing European gas storage facilities next month, indicating that the long-awaited additional Russian supply may be on the way.
Putin said at a conference broadcast on national television on Wednesday that the move would “create a more favorable situation for the European energy market.”
He ordered the state-owned energy giant to focus on filling underground storage in Germany and Austria from November 8th, once it has completed the process in the country. Gazprom CEO Alexei Miller talked to the president via a video link, saying that the domestic reinjection campaign would be extended by one week from the conclusion originally scheduled for November 1.
Miller said that so far, Gazprom has delivered very small amounts of natural gas to its European storage facilities.
Russia’s focus on rebuilding domestic natural gas inventories, coupled with the low storage rate at the Gazprom base in the European Union, has become a major concern for the mainland market, which is struggling with energy shortages and high prices.
Overall, European inventories are at their lowest seasonal level in the past decade.
Putin’s first verbal intervention in the market earlier this month eased the rise in natural gas, but prices have since rebounded slightly. Gazprom’s booking capacity for November has not yet promised any significant improvement in European deliveries. The company said it was fulfilling all contractual obligations, and some EU officials accused the company of withholding fuel to expedite the approval of its controversial Nord Stream 2 pipeline.
According to data from Gas Infrastructure Europe, Gazprom has multiple facilities in Germany, the largest market in Europe, and all of its gas storage sites are now approximately 71% full.
The situation of Russian exporters-owned and co-owned facilities varies from 83% in Jemgum to 9.5% in Rehden. Gazprom has used some of its quantities stored in the European Union in August to make up for the reduced shipments in the Siberian processing plant following a fire.
In Russia, Gazprom plans to reserve a record 72.6 billion cubic meters for the upcoming winter. Miller said that the plan is to complete this task before November 1, but natural gas producers will continue to rebuild their Russian stocks before November 7, because the planned virus blockade will curb fuel consumption.
(Start to update the details of the Gazprom storage site in the seventh paragraph)