By Vladimir Soldatkin and Guy Faulconbridge
MOSCOW (Reuters) – Russian gas giant Gazprom (MCX) continued pumping steady volumes of gas to Europe via Ukraine on Saturday, but supplies to Austrian energy company OMV halted hours after Vienna said Russia had warned that it would cut off the flows.
Russia, which before the Ukraine war was Europe's largest single supplier, has lost almost all of its European customers as the EU tried to reduce its dependence and the Nord Stream gas pipeline to Germany exploded in 2022.
Now one of the last major Russian gas routes to Europe – the Soviet-era Urengoy-Pomary-Uzhgorod gas pipeline via Ukraine – will close at the end of this year, as kyiv does not want to extend a five-year transit agreement that has been in place. gas from northern Siberia to Slovakia, the Czech Republic and Austria.
Austria said on Friday that Moscow had informed it that gas supplies would be cut off from Saturday following an arbitration award given to OMV, Austria's largest energy supplier, over Gazprom's failure to deliver supplies to its German unit.
On Saturday, Austria's energy regulator E-Control said deliveries from Gazprom to OMV had stopped at 6 a.m. local time (0500 GMT), adding that prices and supplies to Austrian customers remained stable. .
OMV is seeking to recover the €230 million in compensation awarded during the Gazprom arbitration by offsetting the claim against invoices for deliveries to Austria, essentially stopping some payments for gas supplied through Ukraine.
Gazprom said it would ship 42.4 million cubic meters of gas to Europe through Ukraine on Saturday, the same volume as Friday.
Flows to Slovakia from Ukraine remained stable, but nominations for flows to Austria from Slovakia were around 16% below averages seen this month, data from transmission system operator Eustream showed.
The OMV typically accounts for around 40% of Russian gas flows through Ukraine, or about 17 million cubic meters per day.
Chancellor Olaf Scholz spoke to President Vladimir Putin on Friday for the first time in almost two years, as European leaders wait to hear Donald Trump's ideas on how to end Europe's biggest ground war since World War II.
GAS POLICY
According to the Kremlin, Putin told Scholz that Russia has always fulfilled its contractual obligations on energy supplies and is “ready for mutually beneficial cooperation if the German side shows interest in it.”
Soviet and post-Soviet leaders spent half a century since the discovery of major Siberian gas deposits in the years after World War II building an energy business that linked the Soviet Union, then Russia and Germany, by far Europe's largest economy.
War and explosions have destroyed that bond, damaging the economies of both countries.
At its peak, Russia supplied 35% of Europe's gas, but since the 2022 war, Gazprom's market share has been lost to Norway, the United States and Qatar.
The Yamal-Europe pipeline through Belarus was shut after a dispute, while Russia blamed the United States and Britain for mysterious explosions under the Baltic Sea that closed the Nord Stream route.
Washington and London have denied blowing up the pipelines. The Wall Street Journal reported that Ukrainian officials were behind the attack. Kyiv has denied this.
Without Austria, important Russian supplies will only reach two European countries: Hungary and Slovakia, in the case of Hungary through an oil pipeline that passes mainly through Türkiye.
Russia shipped about 15 billion cubic meters of gas through Ukraine in 2023, about 8% of peak Russian gas flows to Europe via various routes in 2018-2019, according to data compiled by Reuters.
In 2023, Ukraine's transit route covered 65% of gas demand in Austria and its eastern neighbors Hungary and Slovakia, according to the International Energy Agency.
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