Is Europe's gas supply threatened by the Ukraine crisis? | World news | The Guardian - 0 views
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Is Europe's gas supply threatened by the Ukraine crisis?
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more than a quarter of the EU's total gas needs were met by Russian gas, and some 80% of it came via Ukrainian pipelines. Austria, France, Germany, Hungary, Italy and Poland soon reported gas pressure in their own pipelines was down by as much as 30%.
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While it was eventually resolved through a complex deal that saw Ukraine buying gas from Russia (at full price) and Turkmenistan (at cut price) via a Swiss-registered Gazprom subsidiary
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But three years later, the same row erupted again: Gazprom demanded a price hike to $400-plus from $250, Kiev flatly refused, and on New Year's day 2009, Gazprom began pumping only enough gas to meet the needs of its customers beyond Ukraine.
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Again, the consequences were marked. Inevitably, Russia accused Ukraine of siphoning off supplies meant for European customers to meet its own needs, and cut supplies completely
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several countries – particularly in south-eastern Europe, almost completely dependent on supplies from Ukraine – simply ran out of gas.
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Many industry experts, though, point out that the world has changed since 2009, and that there are any number of reasons why Moscow's natural gas supplies may not prove quite the potent economic and diplomatic weapon they once were.
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higher than normal temperatures are forecast to continue for several weeks yet, significantly reducing demand for gas and leaving prices at their lowest for two years
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since the first "gas war" of 2006, many European countries have made huge efforts to increase their gas storage capacity and stocks are high. Some countries, such as Bulgaria, Slovakia and Moldova, which lack large storage capacity and depend heavily on gas supplies via Ukraine, would certainly suffer from any disruption in supplies
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New Gazprom pipelines via Belarus and the Baltic Sea to Germany (Nord Stream) have cut the proportion of Gazprom's Europe-bound exports that transit via Ukraine to around half the total, meaning only about 15% of Europe's gas now relies on Ukraine's pipelines. Gazprom is also planning a Black Sea pipeline (South Stream), expected in 2015, meaning its exports to Europe will bypass Ukraine completely. Ukraine itself has cut its domestic gas consumption by nearly 40% over the past few years, halving its imports from Russia in the process.
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Europe is increasingly installing specialist terminals that will allow gas to be imported from countries such as Qatar in the form of liquefied natural gas – while Norway's Statoil sold more gas to European countries in 2012 than Gazprom did. "Since the Russian supply cuts of 2006 and 2009, the tables have totally turned," Anders åslund, an energy advisor to both the Russian and Ukrainian governments, told the Washington Post.
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Europe accounts for around a third of Gazprom's total gas sales, and around half of Russia's total budget revenue comes from oil and gas. Moscow needs that source of revenue, and whatever Vladimir Putin's geo-political ambitions, most energy analysts seem to agree he will think twice about jeopardising it.