Page 9 - EurOil Week 21 2022

EurOil PIPELINES & TRANSPORT EurOil

Russia halts gas deliveries to Finland

FINLAND GAZPROM, Russia’s state-run natural gas giant, the Balticconnector pipeline,” it explained in
said on Saturday, May 21 that it had stopped all its statement.
deliveries to Finland as of 6:00 a.m. local time. Likewise, Gasgrid said it did not anticipate
Its announcement was confirmed shortly any difficulties with supplies. In its statement on
thereafter by Gasgrid Finland, the operator of May 21, it described Finland’s gas network as “in
the Nordic country’s national gas pipeline net- balance both physically and commercially.”
work. Gasgrid said in a statement that all ship- Russia is Finland’s main supplier of natural
ments of Russian gas through Imatra, a town on gas. However, gas only accounts for a small share
the border where the Finnish grid is linked to a of the country’s total energy consumption – 6%
branch of Gazprom’s Gryazovets-Vyborg pipe- in 2020, according to a recent report from the
line, had been stopped. Finnish broadcaster YLE.
Additional confirmation came from Gasum, Gazprom Export’s stated reason for the
Finland’s national gas wholesaler. The company supply cut-off was Gasum’s failure to abide by
said in a separate statement that Russian gas new rules payment for gas in Russian rubles.
flows had come to a halt on Sunday, in line with Many observers have noted, however, that the
earlier warnings from Gazprom Export, the Gazprom subsidiary took action shortly after
export arm of Gazprom. Finland declared its intention to seek mem-
The wholesaler also said it did not expect bership in Nato, thereby moving away from
this development to affect deliveries to cus- its long-standing policy of neutrality vis-à-vis
tomers, as it had access to other sources of Russia.
supply via a subsea pipeline link to Estonia. Officials in Moscow have warned Helsinki
“Starting from today, during the upcoming against taking such a step, saying that an appli-
summer season, Gasum will supply natural gas cation to join Nato would be “a grave mistake
to its customers from other sources through with far-reaching consequences” for Finland. ™

POLICY

US mulls easing Venezuelan sanctions

VENEZUELA THE US government is reportedly gearing up to companies to start working with PdVSA to
ease sanctions on Venezuela’s national oil com- export Venezuelan crude on regular commer-
pany (NOC) PdVSA in order to facilitate deliv- cial terms, as they have not been able to do for
eries to Europe, a source familiar with the matter the last three years. It might also help alleviate
told Bloomberg earlier this week. supply concerns on European oil markets, which
According to the source, who spoke on con- have become increasingly tight since the Russian
dition of anonymity, the administration of US invasion of Ukraine in late February. That event
President Joe Biden has given European firms has led many Western traders to shun trans-
with upstream holdings in Venezuela a green actions involving Russian oil in order to avoid
light to resume regular commercial operations reputational damage, and it has also prompted
immediately, without risking penalties under the the US – and now the EU – to restrict imports of
sanctions regime. The US major Chevron has Russian crude.
also been authorised to negotiate with PdVSA Now, though, Eni and Repsol may be in a
on restarting its work in Venezuela, also without position to cover part of this gap with oil from
risk of penalties, the source said. Venezuela, Bloomberg said. It quoted one of its
Venezuela’s political opposition has expressed sources as saying that the Biden administration
its support for this move, he added. was working with the two European companies
The source’s statements could not be con- to divert shipments of Venezuelan crude origi-
firmed as of press time, though Venezuela’s nally destined for China.
Vice President Delcy Rodriguez announced in Meanwhile, officials in Washington are
a post on her Twitter account that Washington not just hoping for movement on energy mar-
had authorised US and European companies to kets. Bloomberg quoted a second anonymous
“negotiate and restart operations” in her country. source as saying that the easing of sanctions was
If these announcements are true, Bloomberg designed to facilitate talks between the Venezue-
noted, the parties most affected by the policy lan opposition and the government of President
shift will be Eni (Italy) and Repsol (Spain). These Nicolas Maduro. The Biden administration
two are the only major European oil firms that could draw flak for this, though, as many US
have maintained upstream operations in Vene- lawmakers from the Republican party oppose
zuela, it explained. moves that might shore up Maduro’s grip on
Easing sanctions would allow these power. ™

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