Gazprom is supplying Russian gas to Europe “as per normal,” the Russian state-owned energy corporation announced Wednesday, despite the ongoing war in Ukraine.
“Gazprom supplies Russian gas for transit to Europe through Ukrainian territory as per normal, in accordance with requests of European consumers — 109.4 mln cubic meters as of March 2,” Gazprom spokesman Sergey Kupriyanov told reporters.
U.S.-aligned nations worldwide have imposed a raft of financial sanctions on Moscow in recent days in an effort to punish the Kremlin for its decision to launch a military operation in Ukraine on February 24. The sanctions have exempted the Russian energy trade so far, allowing Kremlin-run energy corporations to continue profiting. In Gazprom’s case, its business with Europe is currently slightly higher than normal, according to its own account on March 2.
“As of Tuesday, March 1, 109.6 mln cubic meters were requested,” Kupriyanov told reporters, as quoted by Russia’s state-owned TASS news agency.
“This volume is slightly higher than deliveries under long-term booking for gas transit via Ukraine (around 109.5 mln cubic meters per day),” TASS noted.
“U.S., European and other governments exempted [Russia’s] energy trade from sanctions to prevent already tight markets rallying further, but that has failed,” Reuters observed on March 1 of the Western-led effort to pummel the Russian economy with sanctions since February 24.
“Global benchmark Brent crude settled at nearly $105 a barrel on Tuesday [March 1], its highest since August 2014, as refiners, traders and oil majors steer clear of Russia, out of an abundance of caution that they may unwittingly run afoul of sanctions somewhere,” according to the news agency.
TASS similarly noted on March 2 that “the price of gas in Europe surged to over $1,600 per 1,000 cubic meters during Wednesday trading, according to data provided by London’s ICE. The total increase in the gas price has reached 15%.”
“The price of gas futures for April delivery at the TTF hub in the Netherlands went up to $1,607 per 1,000 cubic meters, or 140 euro per MWh (on the basis of the current euro exchange rate against the dollar, prices at ICE are in euro per MWh),” the news agency relayed.
Russia is the world’s second-largest exporter of crude oil. Between the months of January and May 2021, Russia shipped out “10.18 million barrels per day (bpd) compared to 11.18 million bpd in the United States. Saudi Arabia came third with roughly 9 million bpd,” according to the Warsaw Institute.
Gazprom announced on February 28 it had finalized plans to deliver gas to China via a pipeline running through Mongolia.
“The Soyuz Vostok gas pipeline construction project in Mongolia … will be a continuation of the Russian gas pipeline ‘Power of Siberia – 2’ and will allow the supply of up to 50 billion cubic meters of Russian gas per year to China, the world’s fastest growing gas market,” Gazprom wrote in a press release.
Bloomberg described the deal at the time as potentially Moscow’s “biggest-ever” natural gas supply deal with Beijing.
“In 2014, Gazprom signed a 30-year, $400-billion deal to directly supply as much as 38 billion cubic meters of gas per year to China via the Power of Siberia gas link, where deliveries started in late 2019,” the business-focused news site recalled.
“In recent months, when Gazprom’s flows to Europe have been limited, shipments to China were regularly above daily contract volumes,” Bloomberg observed.
Moscow announced a smaller natural gas deal with Beijing on February 4. Gazprom agreed to supply China with a 25-year direct supply of up to 10 billion cubic meters of natural gas per year from the Russian Far East region.
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