Page 4 - FSUOGM Week 39 2022
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FSUOGM COMMENTARY FSUOGM
Sabotage suspected as
gas leaks reported at
both Nord Stream 1 and 2
The pipelines suffered multiple leaks on the same day, and sabotage is widely suspected
RUSSIA NATURAL gas leaks have now been reported at that Nord Stream 1 would return to operation
both Russia’s Nord Stream 1 and Nord Stream 2 helps explain why the market’s reaction to the
WHAT: pipelines, and while the reasons are unclear, the leaks was mute. Futures contracts at the Dutch
Three of the Nord Stream fact that both pipelines should suffer such inci- TTF hub rose by only around 5% at the market’s
1 and 2 pipelines have dents on the same day has prompted speculation opening on September 27, reaching €183/MWh
suffered leaks. of sabotage. by around 08:30 GMT. This followed a decline of
around 6% on the previous day.
WHY: What we know
Sabotage is the The Danish Energy Agency (DEA) reported Causes?
suspected cause. on September 26 that it had been informed of Gazprom has not commented on the matter.
a major drop in pressure at Nord Stream 2. The However, Kremlin spokesman Dmitry Peskov
WHAT NEXT: agency said its “preliminary assessment indi- told reporters on September 27 that sabotage
Investigations are cates that a leak has occurred from one of the could not be ruled out. "No option can be ruled
underway, but for the two Nord Stream 2 pipelines in the Danish area out right now," he said, according to Reuters,
time being, information is south-east of Dueodde at Bornholm … from adding that Moscow was very concerned with
limited. where natural gas is leaking.” The Danish Mar- the situation, which would need a prompt in-
itime Agency has told ships to avoid the area. vestigations given the implications for the ener-
German authorities have also said they are in- gy security of the "entire continent."
vestigating the issue. And there are no official claims that the pipe-
Nord Stream 2 was never brought into oper- lines were sabotaged. However, a report by Ger-
ation, as Germany halted the pipeline’s certifi- man media group Tagesspiegel cited sources as
cation process in late February in response to saying that the government in Berlin was consid-
Russia’s actions in Ukraine, days before Moscow ering sabotage as the likely cause.
launched its all-out invasion. The pipeline was “We can’t imagine a scenario that isn’t a tar-
nevertheless filled with gas last year as part of geted attack,” a source familiar with the federal
preparations for its launch. government’s assessment said, according to the
Meanwhile, the Nord Stream 1 operat- newspaper. “Everything speaks against a coin-
ing company said on September 26 that it had cidence.” Significant gas leaks along pipelines
recorded a pressure drop, and was investigat- are rare, especially for modern ones like Nord
ing the cause. In statements to Russian media Stream 1 and 2. The two pipelines leave the Rus-
the following day, the operator said that the sian shore at different points, using different
destruction caused to the pipeline system was infrastructure, making it seemingly unlikely that
“unprecedented,” and that it was unclear how a technical problem further up the gas stream
long it would take to fix. The Swedish Maritime could have caused the simultaneous leakages.
Administration also confirmed on September 27 The incidents come after Russia’s security ser-
that leaks had occurred at Nord Stream 1 as well vices notably claimed on September 22 that they
as Nord Stream 2. had successfully thwarted a planned Ukrainian
Nord Stream 1 indefinitely shut down gas attack at an oil and gas infrastructure site that
flows on September 5, with Gazprom citing supplies energy to Turkey and Europe. Ukraine
technical difficulties relating to problems get- has denied this. Russian security services did not
ting equipment repaired overseas because of specify which piece of infrastructure had been
Western sanctions. Gazprom had been curtail- targeted, but the only route for Russian energy to
ing its gas flow since June, and before its closure, both Turkey and Europe is the TurkStream pipe-
it was operating at only 20% of its 55 bcm per line. Like Nord Stream 1 and 2, it was built largely
year capacity. to allow Russia to bypass the Ukrainian gas tran-
The fact that there was little expectation sit system, reducing its reliance on Kyiv.
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