Russia announced to European customers that it has suffered from force majeure.Can Europe still support it?

According to CCTV News quoted Reuters on July 18, Russia's Natural Gas Industry Co., Ltd. (Gazprom) (GAZP, a stock price of 186.7 rubles, a market value of 4.42 trillion rubles) declared in a letter on the 14th that the company would supply natural gas to Europe to Europe The business is affected by "force majeure", and this "force majeure" will affect the natural gas supply of at least one major customer.

The letter shows that as a giant of the Russian pipeline natural gas exports, Gazprom has not fully fulfilled its gas supply obligations because it encountered "force majeure", and this "force majeure" has affected the company's natural gas supply since the 14th. However, the media did not disclose the specific situation of this "force majeure". In response to this news, Gazprom has not published any comments.

Sources said that the letter showed that Gazprom may further reduce Russia's gas transmission of Russia's main gas pipeline "Beixi-1". If Gazprom completely interrupted the "Beixi-1" gas transmission, the price of natural gas in Europe will soar further.

The news promoted the rise of international oil prices. As of the closing of the US stocks on Monday, WTI rose 5.13%in August to US $ 102.60/barrel. Since July 11 last Monday, it has closed at 100 US dollars on the first five trading days since the last five trading days. Pass; Brent in September of September closed up 5.05%to $ 106.27/barrel, which also set a new high since July 11.

On July 22, can "Beixi-1" restore gas supply on time?

According to reports, the German energy giant and Russian natural gas in Germany, Uniper (UN01, 9.32 euros, a market value of 3.411 billion euros) said that the above -mentioned letter from Gazprom has been received. However, Uniper believes that this announcement is unreasonable and has officially rejected the force majeure. In addition to Uniper, Rhein Group, the largest power generation company in Germany and the third largest renewable energy company in Europe (RWE, shares at 36.83 euros, and a market value of 24.905 billion euros) also said that it has received the inherited notification of Gazprom.

Some commented that Gazprom seems to be preparing for the "Qi" operation on July 22. On July 22, the first day of Gazprom should end the maintenance and restore gas supply of Beixi-1 pipeline as planned. Another comment that the news seemed to suggest that Gazprom may last longer when GAZPROM's state of gas transmission in Europe may last longer, longer than the maintenance period of the planned pipeline.

It is worth noting that since the upgrade of Russia and Ukraine's conflict, Russia has repeatedly reduced the amount of gas transmission to major pipelines such as "Beixi-1" to major European countries. According to CCTV news reports, in mid-June, Gazprom stated that the Russian side was forced to reduce the gas transmission of the "Beixi-1" pipeline because German Siemens did not give the Russia's repairer in time. From July 11, the "Beixi-1" suspended operation and carried out annual routine maintenance. It is expected that the maintenance process will take 10 days.

Many German officials and people are worried that after the regular maintenance is completed on the 21st, the Russia may not restore gas transmission, causing gas prices to soar further.

To this end, while the German government formulates the energy crisis plan, it also strives to ensure the recovery of gas supply in the "Beixi-1" pipeline. According to CCTV News quoted Russian media reports on the 18th, the "Beixi-1" natural gas pipeline components sent by Siemens have been shipped from Canada to Germany and will be shipped to Russia on the 24th.

According to CCTV, the current reserves of German gas storage facilities have been close to 65%. Although this is the highest gas storage in several weeks, it is still not enough to allow the German people to spend winter smoothly without Russia's natural gas. Many industrial enterprises are also facing the dilemma of "airless available".

Although some companies are exploring other energy sources such as crude oil and coal replacement of natural gas, for many industrial enterprises, the role of natural gas is "irreplaceable". Officials from the German Chemical Industry Association said, "In our industry, only 2%to 3%of natural gas can be replaced. This is not enough to solve the problems we face."

Photo source: Xinhua News Agency, Christel Photo

For Europe, what does "break down" mean?

According to CCTV News, because of concerns about Russia's extension of the "Beixi-1" maintenance period and even completely cutting off this important gas transmission pipeline, the German federal government believes that the entire German or some federal states may occur in the winter of this year. The problem of natural gas supply in Germany may last until 2024.

According to the German government, the prices of domestic natural gas in Germany will rise by two to three times. In terms of oil prices, some analysts believe that considering that public utility enterprises and manufacturing industries that consume natural gas may seek reflective oil replacement, Gazprom announced that it is possible to keep the market bet, and the momentum of strong oil prices will remain longer.

Deutsche Bank analyst Jim Ride had previously stated that on July 22, the day when the "Beixi-1" natural gas pipeline should be operated, it may be the most important day of the global market this year.

If Russia really cuts off all the natural gas losses on July 22, then the European market that has recently been "scarred" is undoubtedly "worse than snow".

UBS chief economist Arrona Kapin predicts in a report that if Russia stops sending natural gas to Europe, European corporate profits will decrease by more than 15%, and the market selling for the Stock 600 Index will exceed 20%. The euro will fall to 90 cents. In addition, market risk aversion will push German Treasury yields to 0%. Liberum Capital's strategy director Joshim Clefente believes that Russian natural gas has no alternative at all. The biggest unknown is how energy shocks began in Germany, Poland and other Central European countries will affect other parts of Europe and even the world.

Today, in the face of the risks of "qi", Europe is looking for alternatives of Russian qi. According to CCTV News, on July 18, local time, the Chairman of the European Commission Feng Delin and Azerbaijan President Ariyev signed the "Memorandum of Strategic Partnership in the Energy Field", stipulating that Afang increased to the EU's natural gas gas supply through the southern natural gas pipeline year year by year. As of 2027, it reached no less than 20 billion cubic meters per year. This is almost a bit over 12 billion cubic meters of gas supply this year.

It is worth noting that the International Energy Agency (IEA) is ranging the red alarm, saying that the world is experiencing the first real energy crisis in history, and European conditions are particularly dangerous. IEA warns that Europe must immediately reduce natural gas consumption.

Daily Economic News

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