The following report is by ZeroHedge:
After a 3-day halt, Russian energy giant Gazprom was expected to resume critical supplies of nat gas to Europe via Nord Stream 1 tomorrow, but it appears that Putin who is enjoying the game of cat and mouse a little too much, had other plans and as a result, Russian gas flows toward Europe won’t be coming back any time soon, as moments ago Gazprom announced that it had “completely halted” transport of gas to Nord Stream until a previously undetected oil leakage is rectified.
That could takes hours, days… or months.
- GAZPROM ISSUES STATEMENT ON NORD STREAM 1 MAINTENANCE
- GAZPROM: TRANSPORT OF GAS TO THE NORD STREAM PIPELINE HAS BEEN COMPLETELY HALTED UNTIL FAULTS ARE RECTIFIED
- GAZPROM: DURING ROUTINE MAINTENANCE WORKS OIL LEAKAGE WAS DETECTED
- GAS SUPPLIES TO NORD STREAM FULLY STOPPED
- GAZPROM STATEMENT GIVES NO TIME FRAME FOR RESTART OF GAS SUPPLY THROUGH NORD STREAM 1
Here is a photo of the alleged “oil leak”:
The “shocking development” is a massive blow to Europe, which is scrambling to fill up its gas storage ahead of winter and which has been trying to guess Moscow’s next steps in the energy war for weeks.
To quote Walter Sobchak, “Mark it zero” for the foreseeable future.
That means that Europe will now be forced to rely even more on… well… Russian gas, in the form of much more expensive LNG resold by China. And after tumbling by more than 50% in the past few days, we fully expect European gas prices are about to go super parabolic and take out all time highs as soon as trading returns on Monday.
The news promptly sent spoos sliding back under 4000 as any hope Europe’s energy hyperinflation was finally over were just steamrolled by the Russian president.
What does this mean for European NatGas prices when they wake up on Monday morning (or Sunday night) while America celebrates Labor by not working?
Goldman’s Samantha Dart has the details and they are not pretty…
We believe this will reignite market uncertainty regarding the region’s ability to manage storage through winter, driving a significant rally from Monday, potentially mimicking the August highs, should the issue at NS1 remain unresolved. However, we reiterate our view that even in a scenario where NS1 remains at zero, we estimate NW European gas markets can balance with Bal Summer TTF prices in a 215-230 EUR/MWh range (depending on how much the lower NS1 flows are offset by lower German re-exports of Russian gas), vs our 176 EUR TTF expectations under NS1 at a 20% flow.
Importantly, our price scenarios rely on our estimated demand elasticity of 1 mcm/d per 1.8 EUR move in prices. Hence, a potential decline in observed demand elasticity poses an upside risk to our price views. Specifically, should demand elasticity drop by half, for example, vs our original estimate, we estimate balance-of-summer TTF prices up to 290 EUR/MWh would be required to take storage to 90% full under a zero-flow NS1 scenario.
A renewed rally of European gas prices on the back of today’s NS1 news will likely also heat up the debate around government intervention in the market, with most statements from public officials so far pointing towards an intervention in electricity markets.
We caution that, depending on the impact of such an intervention on power prices, this could indirectly further tighten gas balances by incentivizing increased power consumption and, as a result, gas demand. Instead, we believe that government-led reverse auctions might be a safer route, from a gas balance perspective. This would mean governments would buy back gas directly from industrial users on a voluntary basis to place in storage. As this would be a form of gas demand destruction independent of gas prices, it would help guarantee storage builds while removing the burden of the adjustment from prices, ultimately driving gas and power prices lower vs a scenario without auctions.
As Bloomberg puts it, “it marks a dramatic escalation in Europe’s energy crisis — and comes just as prices were easing. If the shutdown persists, it puts households, factories and economies at risk, weakening Europe’s hand as it backs Ukraine in the war against Russia.” Said otherwise, millions of virtue signalers will be cold, hungry and in the dark this winter but at least they will have an Ukraine flag in their twitter bio.
AUTHOR COMMENTARY
So I returned, and considered all the oppressions that are done under the sun: and behold the tears of such as were oppressed, and they had no comforter; and on the side of their oppressors there was power; but they had no comforter.
Ecclesiastes 4:1
Regulars of The WP know that Europe has decreed wickedness upon themselves, by obstinately continuing to keep these restrictions levied upon Russia. Now Europe will get pounded even harder now. Therefore, you must needs continue to prepare for a long and hard winter.
I reported just a few days ago that the German Foreign Minister explicitly declared that she will defend and fund Ukraine before her own people. If that doesn’t do it for you, and then not too much else will until it’s too late.
A prudent man foreseeth the evil, and hideth himself: but the simple pass on, and are punished.
Proverbs 22:3
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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Will the dark winter be this year? Could very be!
Hey brother JT.
What happened to your youtube channel? I can’t find it
They terminated it. I am away from the office for most of the day today, so there is not much I can do to fix it, but I am hoping I can get it back. Part of me is relieved it’s gone. Too much drama and toxicity.
More dark & bloody theater. Got to keep the plot full of surprises & twists….not that they& their ends are wicked, but just how they’ll wrap their lies & deliver their death cult package this time. Good thing the Lord foresees & knows every move they make: and he will avenge.
US Helicopters circled around the exact area of the break for days prior to the explosion. Biden went on national news and even stated that he had ways to make the pipe line halt if Putin didn’t do it first, “Believe Me” he emphasized.
With the FBI now attacking the Left’s opposition by SWAT raiding their residences and trying to put fear in everyone else that it might happen to you…who cares about the war in Ukraine when there is one right here at home.