Russia Stops Gas Supplies to Italy

Russia’s state-owned energy giant Gazprom halted gas supplies to Italy because of a dispute with Austria over regulation, escalating the energy crisis in Europe. While the dispute is with Austrian authorities, the cutoff targeted Italy, which gets Russian supplies via a pipeline that passes through Austria. Austria’s OMV, which imports Russian gas to the country, said higher volumes of Russian gas were allocated than recently. Gazprom said it suspended deliveries to Italy because the Austrian regulator has refused to confirm “transport nominations” after regulatory changes implemented in Austria in late September.

The latests cutoff shows once again Europe’s vulnerability to Putin’s repeated moves to block gas supplies to the continent. The conflict has deepened last week after massive leaks were detected in Nord Stream 1 and Nord Stream 2 pipelines, which brought up suspicions of sabotage.

Austria’s Energy Ministry said Gazprom had failed to sign off on contractual changes that reflect technical rule adjustments typically made at the start of each gas year. Gazprom, like other market participants, had known of the changes for months, Austrian regulator E-Control said.

Since Russia launched the invasion of Ukraine in February, disputes over contractual clauses and regulation have accompanied the meltdown in economic ties between Moscow and Europe. Earlier, Putin’s demands for gas payments in roubles had exacerbated soaring gas prices.

Italy, once relied on Russia for about 40% of its gas imports, has been aggressively cutting that dependence since the invasion in February. Italy has now sourced sufficient alternative supplies of gas from North Africa to make up for any shortfalls this winter if Russia were to cut off supplies. A boost of expected deliveries from Algeria and Egypt will be able to cover the remaining supplies that Italy was still getting from Russia.

The cutoff came just days after two large leaks were detected on the Nord Stream pipelines. Biden and many Western European leaders emphasized their suspicions of sabotage.

Fearing a similar attack, Norway’s armed forces ramped up patrols of the country’s energy facilities and Germany, France and the UK offered to help protect oil and gas installations in the North Sea. NATO is also using its naval and air capabilities to monitor the Baltic and North Seas.

With Nord Stream out of commission, there is now just one major pipeline bringing natural gas straight to Europe. That route, which passes through Ukraine, is also looking increasingly vulnerable. That pipeline has already had part of its supply knocked out by the war, and could turn out to be the next to close as the conflict drags on.

Gazprom Saturday also reduced the daily gas flow levels to Moldova through Ukraine and blamed Kyiv for the reduction.

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