Page 4 - EurOil Week 27 2022

EurOil COMMENTARY EurOil

Russian gas wars force

Germany’s Uniper into bailout

talks with government

The downfall of the German energy giant may be the first of many such cases

in the European energy sector

RUSSIA RUSSIA’S decision to cut gas supplies to Europe the profits for companies like Uniper.
has forced German energy giant Uniper to ask Uniper is one of Russian Gazprom’s biggest
WHAT: the government for a bailout. European customers and Germany is the biggest
Germany’s government Gazprom reduced flows of gas to Europe by importer of Russian gas.
may arrange a bailout for 60% on the middle of June, causing the company Uniper chief executive Klaus-Dieter
Uniper. to lose an estimated $30mn a day. Maubach said the bailout talks included possible
Uniper approached the government for help guarantees, raising credit facilities or even the
WHY: at the end of the month due to dwindling sup- state taking an equity stake. He did not say how
Like other European plies of Russian gas. much money he was seeking, reports Reuters.
energy utilities, Uniper The falling supply of gas has forced utilities Uniper shares closed 14.4% lower after the
has been hit by soaring across the continent to buy gas from the spot news broke and are down 66% YTD. The shares
costs and disruptions in market, where prices are multiples of the aver- of Finland’s Fortum, which owns 78% of Uniper,
Russian gas supply. age. Berlin is particularly worried about the lack also fell 6.1% on the news.
of gas. German Vice-Chancellor Robert Habeck Uniper says it has received only 40% of the
WHAT NEXT: has already put the country on energy crisis contractually agreed gas volumes from Gazprom
The company’s “alert” that under EU rules also allows him to since June 16, when Gazprom reduced the flows
restructuring must change the regulations and pass on the soaring claiming a technical breakdown caused by the
underway before traders costs to the consumer. sanctions on Russia. Habeck rejected Gazprom’s
run out of cash. However, governments are also worried excuse and described the decision to reduce
about rising inflation that is threatening to flows as an “attack” on Europe.
turn into stagflation and have capped prices for Uniper was already having financial difficul-
energy for consumers for the present, squeezing ties before the war with Ukraine broke out in

P4 www. NEWSBASE .com Week 27 08•July•2022