U.S. Raises Concerns On The Planned Nord Stream 2 Gas Pipeline From Russia To Germany

Reuters: Russia-Germany gas pipeline raises intelligence concerns: U.S. official

BERLIN (Reuters) - The planned Nord Stream 2 gas pipeline from Russia to Germany raises U.S. intelligence and military concerns since it would allow Moscow to place new listening and monitoring technology in the Baltic Sea, a senior U.S. official said on Thursday.

Sandra Oudkirk, Deputy Assistant Secretary of State for Energy Diplomacy, said in Berlin she would meet German officials to voice Washington’s concerns about the subsea project.

A consortium of western companies and Russia’s Gazprom said this week it was starting preparatory work off Germany’s Baltic coast.

Oudkirk told reporters the U.S. Congress had given the president new authority to impose sanctions against a variety of Russian pipeline projects.

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WNU Editor: This pipeline is going to be built .... U.S. objections or not. There is just too much money involved for both Germany and Russia, and in the end it is all about money .... Russian Gas 'Will Remain Cheaper in the Long Run' Than US' LNG - German Media (Sputnik)

More News On U.S. Objections To The Planned Nord Stream 2 Gas Pipeline From Russia To Germany

US warns of sanctions risk to Germany-Russia gas pipeline -- AP
U.S. Is Trying to Kill Major Gas Deal Between Russia and Germany -- Newsweek
US threatens to punish Russia & Germany if they continue playing with gas -- RT
U.S. Warns Russian-German Gas Pipeline Risks Triggering Sanctions -- RFE
Germany and the US disagree over Russia's new Nordstream 2 pipeline -- Euronews
Germany Brushes Aside U.S. Objection to Russia Gas Pipeline Link -- Bloomberg
German Envoy Sees U.S. Sanctions Likely Over Russia Gas Pipeline -- Bloomberg
Germany expresses support for Nord Stream-2 project — Lavrov -- TASS
Trump Forbids Russian Pipeline. Europe Pushes Back -- Leonid Bershidsky, Bloomberg

Ukrainian, Slovak PMs Condemn Russian Plans To Bypass Their Countries In Gas Exports To The West

Business Insider

Reuters: Ukraine gas bypass deal a "betrayal"-Slovak PM

* Ukraine could lose billions, Slovakia hundreds of millions euros (Adds quotes, background, details)

BRATISLAVA, Sept 10 (Reuters) - Slovak Prime Minister Robert Fico on Thursday called a deal between Russia's Gazprom and its European partners to expand the Nordstream gas pipeline a "betrayal" that would cost Ukraine and Slovakia a combined billions of euros in transit fees.

Last week, Gazprom and its European partners signed a shareholders' agreement on the Nord Stream-2 gas pipeline project that will bypass Ukraine and run beneath the Baltic Sea to Europe, bringing Europe closer into Moscow's energy orbit.

Gazprom signed the deal with Germany's E.ON and BASF/Wintershall, Austria's OMV, ENGIE of France and Royal Dutch Shell. It stipulates that new pipeline capacity from Russia will come online in 2019.

Update: Ukraine, Slovakia Condemn Russian Gas Pipeline Project -- AP

WNU Editor: The Russian gas giant has made the decision to cut out the "middle man". For Ukraine .... the loss in transit revenues alone will be in the billions.

Russia Shocks Europe By Ending All Gas Transfers Through Ukraine

European dependance on Russian natural gas

(image by Michael Collins)

Daily Mail: Europe plunged into energy crisis as Russia cuts off gas supply via Ukraine

WNU Editor: This is a major announcement from Russia .... the equivalent of using a nuclear economic bomb .... and one that will severely impact Ukraine and all of Europe. Not surprising .... prices are now skyrocketing throughout Europe, and for a country like Ukraine that earned fees and concessions for this transfer .... that is now all but dead and one that will profoundly impact its finances. And while the international media is focused on international terrorism ..... this is also a big story .... it is Russia's way of retaliating against sanctions .... and one that is going to hurt everyone in Europe. This probably explains why German Chancellor Merkel had harsh words for Putin today ..... she understands what the consequences of this cut-off will have on Europe .... and on Germany.

More News On Russia Ending All Gas Transfers Through Ukraine For Europe

Russia to Shift Ukraine Gas Transit to Turkey as EU Cries Foul -- Bloomberg
Russia Cuts Off Ukraine Gas Supply To 6 European Countries -- Zero Hedge
Russia Fires Ukraine as Natural Gas Transit for Europe -- OPEdNews
Gazprom informs EC official on transit risks for European customers on Ukraine territory -- Gazprom

Update: This post has a good collection of tables and graphs that outline Europe's dependence on Russian natural gas exports ... that link is here.

Update #2: This post gives a good explanation on the significance of what Russia did today .... Russia pulls trigger on two moves to counter the U.S. and end petrodollar -- Kenneth Schortgen Jr, Washington Examiner

WNU Editor: Hat Tip to reader Jay who gave me the heads up on this story earlier today.

In A Major Diplomatic Defeat, Russia Announces That It Will Not Build The South Stream Gas Pipeline To Europe

In Diplomatic Defeat, Putin Diverts Pipeline to Turkey -- New York Times

MOSCOW — President Vladimir V. Putin said Monday that he would scrap Russia’s South Stream gas pipeline, a grandiose project that was once intended to establish the country’s dominance in southeastern Europe but instead fell victim to Russia’s increasingly toxic relationship with the West.

It was a rare diplomatic defeat for Mr. Putin, who said Russia would redirect the pipeline to Turkey. He painted the failure to build the pipeline as a loss for Europe and blamed Brussels for its intransigence.

The decision also seemed to be a rare victory for the European Union and the Obama administration, which have appeared largely impotent this year as Mr. Putin annexed Crimea and stirred rebellion in eastern Ukraine.

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More News On Russia Announcing That It Will Not Build The South Stream Gas Pipeline To Europe

Putin: Russia forced to withdraw from S. Stream project due to EU stance -- RT
Gazprom to build new 63 bcm Black Sea pipeline to Turkey instead of S. Stream -- RT
Russia Scraps South Stream Gas Project: Gazprom -- RIA Novosti
Russia drops South Stream gas pipeline plan -- BBC
Putin says Russia to stop South Stream gas pipeline project -- Euronews
Putin says Russia scrapping South Stream gas pipeline, blames Europe -- L.A. Times

Tho Will Pay-Off Ukraine's Multibillion-Dollar Gas Debt?

Reuters/Valentyn Ogirenko

Ukraine's Multibillion-Dollar Gas Debt: Who Pays? -- RT

Ukraine plans to buy $770 million worth of gas (2 billion cubic meters) from Russia this winter to keep the heat on, but before that, they must pay off $1.45 billion in debt. The question is: who is going to pay the bill?

All three parties, Russia, the EU, and Ukraine met in Brussels on Tuesday and confirmed Kiev will pay $385 per 1,000 cubic meters of Russian supplied gas through the end of March. Before Ukraine can start purchasing gas, they need to pay off $1.45 billion in debt.

“There’s one obstacle: Ukraine failed to pay for Russian-supplied gas for seven months,” Oettinger said Tuesday. It will be difficult for Ukraine to find a benefactor, since, as Oettinger pointed out, its credit history is less than stellar. The economy is in ruin and may already need extra IMF money to stay afloat.

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My Comment: It is always about the money. Bottom line .... Ukraine is bankrupt and it does not have the means to pay-off this debt. They are hoping that the Europeans would give them the money to do so .... but the problem (from the European perspective) is that the last time they did that, the government in Kiev essentially took the money to pay off it's government employees and to pay for it's war against the eastern part of the country. I doubt that the EU is not going to make the same mistake again .... hence the impasse of today. My prediction .... the EU will pay-off this debt, and they will give the Ukraine government extra money via through loans and other subsidies.

Russia - Ukraine - E.U. Gas Deal Reached

Exclusive: Ukraine Prime Minister Says Russians 'Want Us To Freeze' -- Reuters

(Reuters) - The prime minister of the Kiev government accused Russia on Thursday of attempting to freeze Ukraine in the coming winter by using natural gas as a weapon to subjugate the former Soviet Republic.

"They want us to freeze. This is the aim and this is another trump card in Russian hands. So, except military offense, except military operation against Ukraine, they have another trump card, which is energy," Prime Minister Arseny Yatseniuk said in an interview on the sidelines of the United Nations General Assembly in New York City.

"The ultimate goal of Russia is to organize, to orchestrate another frozen conflict in Ukraine."

Russia's state-controlled energy company Gazprom cut off gas supplies to Ukraine in June because of a row over Kiev's unpaid gas bill, raising concerns that the country may not be able to cover the peak-demand winter season.

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More News On A Russia - Ukraine - E.U. Gas Deal Being Reached

Deal Reached to Provide Ukraine With Russian Gas -- NYT
Russia, Ukraine Move Toward Interim Gas Deal Before Winter -- Bloomberg Businessweek
EU unveils interim deal for ending Russia-Ukraine gas war -- AFP
EU, Russia positive on chance of winter gas deal with Ukraine -- Reuters
Ukraine to pay $3.1bn of Gazprom debt by end of 2014 - EU Energy Commissioner -- RT
Russia and Ukraine near deal on gas supplies -- Financial Times
Ukraine's Gas Deal With Russia Reflects Shifting Pressures -- WSJ

My Comment: Russia is going to accept the deal. The EU/IMF are guaranteeing payment .... and it would not surprise me if these institutions bypass Kiev and pay the Russians directly. For Ukraine .... they will get their gas but their debt levels with the West have just escalated appreciably.

Ukraine Preparing To Halt Russian Transit Gas Flows To Europe

The list of possible sanctions includes a “complete or partial ban on the transit of all resources,” Prime Minister Arseniy Yatsenyuk told reporters in Kiev today in response to a question about halting gas flows. Photographer: Vincent Mundy/Bloomberg

Ukraine Open To Halting Gas Flows In Russia Sanctions -- Bloomberg

Ukraine said it’s open to halting Russian gas supplies to Europe through the country as it plans sanctions on President Vladimir Putin’s government as part of its battle against pro-Russian separatists.

The list of possible sanctions includes a “complete or partial ban on the transit of all resources,” Prime Minister Arseniy Yatsenyuk told reporters in Kiev today in response to a question about halting gas flows. Measures may also include a ban on Russian planes overflying Ukraine, he said, while defense-industry cooperation will be reduced. A draft law, which requires parliamentary approval, also proposes restrictions on ships entering Ukrainian waters.

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More News On Ukraine Preparing To Halt Russian Transit Gas Flows To Europe

Ukraine transit sanctions could hit 'all types of transit': PM -- Reuters
Ukraine may block all transit from Russia in sanctions row -PM -- RT
Ukraine crisis: Kiev ready to sanction Russia in fight to stop 'financing terrorism' -- The Independent
Ukraine govt to submit bill on 26 types of sanctions to Verkhovna Rada -- Interfax-Ukraine

My Comment: This is not going to go over well in the rest of Europe. My analysis .... this is a shakedown on Europe .... the government in Kiev is basically saying to the EU that they should pay  Ukraine's Russian gas bill .... and if they do .... they will let the Russians ship gas to Europe.

Russia Begins Using It's Natural Gas 'Weapon' Against Ukraine

A file photograph of gas pipes at an underground gas storage facility in the village of Mryn, 120 kms north of Kiev. Reuters

Russia's Political Tool; Gazprom Threatens To Increase Gas Prices By 37 Percent To Ukraine -- IBTimes

Just days after the head of the Russian state-owned company Gazprom threatened to cut natural gas supplies to Ukraine, officials say the energy company is likely to increase prices by about 37 percent.

Prices could rise from $268.50 to $368.50 per 1,000 cubic meters of the fuel in the second quarter, Ukrainian Energy Minister Yuri Prodan said on Sunday, as reported by Interfax news agency.

Since ousted Ukrainian President Viktor Yanukovych fled to Russia in late February, Ukraine hasn't paid its gas bill that the company said is worth $2 billion.

“Either Ukraine makes good on its debt and pays for current supplies, or there is risk of returning to the situation of early 2009,” Gazprom’s CEO Alexei Miller threatened on Friday. Gazprom in 2009 cut gas supplies to Ukraine over price disputes.

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More News On Russian Natural Gas Exports To Ukraine

Ukraine expects gas price of $368.5 per 1,000 cubic metres from Russia -- Reuters
Ukraine Sees Gazprom Charging 37% More for Gas in Q2 -- Bloomberg
Gazprom warns Ukraine of gas export cut at USD 1.89 billion -- Steelguru.com
EU leaders draw up plans to send gas to Ukraine if Russia cuts off supply -- The Guardian
Germany's dependence on Russian gas poses risks for Europe - Polish PM -- Reuters
White House plays down speedy role for U.S. natural gas in Ukraine -- Reuters
Ukraine crisis: US plays down Russia gas threat -- Strait Times/AFP
West tries to shake Russia’s grip on Ukraine’s gas -- Market Watch
Energy Markets Watching the Diplomats -- WSJ

My Comment: This is a "red herring" .... US natural gas exports to Europe will not alleviate the situation ... not even close. Russia sells their gas at world market prices .... with Ukraine being an exception (they were paying a third below market prices). I doubt that US gas will be cheaper .... if anything .... it will probably be more expensive because of transportation costs.

Another Natural Gas Dispute Between Russia And Belarus. Supplies To Europe Will Not Be Impacted

Russia Deepens Belarus Gas Cuts -- Wall Street Journal

MOSCOW—Russia stepped up pressure on neighboring Belarus Tuesday, reducing natural gas supplies to the country by 30% as Minsk threatened to take gas destined for Europe from transit pipelines, Russia's state-run gas giant OAO Gazprom said.

From 6 a.m. GMT on Tuesday, Gazprom reduced supplies of Russian gas to Belarus by 30%, said Alexei Miller, chief executive of Gazprom. The company reduced gas supplies Monday by 15% and Mr. Miller said the gas cuts would be increased to 85% in the coming days if Minsk doesn't pay an unsettled gas bill of $192 million.

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More News On The Russia - Belarus Natural Gas Dispute

Belarus 'to suspend Russian gas transit to Europe' -- BBC
Gazprom pledges full gas supplies to Europe regardless of Belarus cutoff (Update) -- RIA Novosti
Russia deepens gas supply cuts to Belarus -- AP
Russia cuts further gas supplies to Belarus: reports -- Market Watch
German Minister Doesn't Fear Gas Shortage From Russian Shut-off -- Wall Street Journal
Ukraine 'neutral' on Russia-Belarus gas conflict - Foreign Ministry -- RIA Novsoti
Kiev to take up gas slack from Belarus? -- UPI

My Comment: Belarus is poorly positioned to take on Russia on this dispute. They are hoping that Gazpron's European customers will pressure Russia to make some form of accomodation .... but with alternate routes now available in the Ukraine, this pressure tactic is not going to work. I expoect Belarus to knuckle down before the winter season .... or sooner.

States Of Emergency Declared Across Europe Over Gas

Schools and factories were closed and trees were felled to keep home fires burning

From Times Online:

Governments across Europe declared states of emergency and ordered factories to close as Russia cut all gas supplies through Ukraine yesterday in their worsening dispute over unpaid bills.

José Manuel Barroso, the European Commission President, accused the two countries of taking the EU's energy supply “hostage” amid a cold snap across the Continent, and urged them to reopen the pipelines immediately.

Schools and factories were closed and trees were felled to keep home fires burning after Russia turned off the gas taps to more than a dozen countries. It was a clear demonstration of the dependence of the Continent on Russian gas supplies.

Despite temperatures as low as minus 27C and the threat of heating cuts to millions of households, Moscow said that it had no choice but to cease supplies because Ukraine, the country through which 80 per cent of Russian gas bound for Europe flows, had closed its pipelines. The claim was denied by Kiev.

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Energy Crisis Deepens For Europe

Gas valves and pipes at a gas pipeline in Butimanu, Romania. Hungary, Slovakia, Romania and Poland had reportedly suffered the most from Russian cuts of gas flow. Tudor Vintilou / Bloomberg News

Russia Stops All Gas Supply To Europe Via Ukraine
-- Yahoo News/AP

KIEV, Ukraine – Russia shut off all gas supplies to Europe through Ukraine on Wednesday — leaving tens of thousands of people in more than a dozen countries without heat during a winter cold snap. The EU accused both nations of holding consumers hostage in their contract dispute.

The effects of the gas cutoff reverberated across the continent, where some countries have substantial reserves and others do not.

In the Balkans, people celebrated Orthodox Christmas in churches lit by candles and scrambled to find other sources of heat for their homes as authorities cut off some gas to conserve supplies.

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More News On Europe's Gas Crisis

New cold war in Europe as Russia turns off gas supplies -- The Independent
Halt in Russian gas supplies to Europe deepens crisis -- Yahoo News/AFP
Gas row sends shiver through freezing Europe -- CNN
Flow of Gas From Russia Via Ukraine Plummets -- Washington Post
Russia again cuts flow of gas through Ukraine -- L.A. Times
Ukraine Says Russia Halts All Gas to Europe -- New York Times
Gas cut: How Europe is coping -- BBC
Gas Spat Sends Shivers Across Europe -- Wall Street Journal
Russia Cuts Gas Supplies to Europe -- Christian Science Monitor
Eastern Europe Limits Gas Use; Germany Meets Demand -- Bloomberg
Russia's Putin to visit Berlin as gas row escalates -- Reuters
Ukraine: Gas Talks With Russia to Resume Thursday -- Voice of America
The Winter Gas War -- Wall Street Journal editorial

Europe Begins To Feel Gas Pipeline Pinch

From The Christian Science Monitor:

The Russia-Ukraine gas war has left some downstream nations with only a mild shortfall, but has incited debate on how to secure energy reserves amid regional instability.

Moscow - Thermometers are plunging across Europe, and so is the pressure in the natural-gas pipelines connecting the continent with its key supplier, Russia.

But no one is pushing the panic button yet. The five-day-old gas war between Moscow and Kiev appears worse than in past years, aggravated by Ukraine's deepening financial and political crises and Russia's urgent need to refloat its floundering state budget by raising gas prices. Europe, watching closely, has sufficient gas reserves to see it through any short-term crisis and has officially declined to take sides.

The increasingly acerbic dispute, which has seen Russia's state gas monopoly Gazprom accuse its Ukrainian counterpart of "stealing" gas and acting to damage the pipeline that transports 80 percent of Russia's gas exports to Europe, may be doing permanent harm to Moscow's relations with its most important ex-Soviet neighbor. It has also reignited a European debate about how to secure energy supplies amid deepening instability in the resource-rich former Soviet lands to the east.

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More News On the Natural Gas Cutoff

Russian Natural Gas Supply to Europe Dwindles -- Washington Post
Europe's reliance on Russian gas -- BBC
European countries under pressure to share gas with shortage-hit neighbours -- The Guardian
Russian Dispute With Ukraine Worsens, Hitting Europe -- Bloomberg
Ukraine: Gas Talks With Russia to Resume Thursday -- Voice Of America