Russia cuts off gas supplies to Austria – Reuters

The Russian energy giant Gazprom has stopped gas supplies for Austrian energy company OMV, just hours after Vienna revealed that Russia had issued a warning about the cut-off.

Source: Reuters

Details: Austria announced on Friday that Moscow had notified it of a gas cutoff, effective Saturday, 16 November. This followed an arbitration ruling in favour of OMV, Austria's largest energy supplier, due to Gazprom's failure to meet its obligations to supply gas to its German subsidiary.

The Austrian energy regulator E-Control reported on Saturday that Gazprom's supplies to OMV had stopped at 06:00 local time, adding that prices and supplies to Austrian customers remained stable.

OMV is seeking to recover €230 million in damages from Gazprom, as awarded in arbitration.

Gazprom claimed it would send 42.4 million cubic metres (MCM) of gas to Europe via Ukraine on Saturday, the same volume as on Friday.

According to data from gas transmission system operator Eustream, flows from Ukraine to Slovakia remained stable, but nominations for flows from Slovakia to Austria were approximately 16% below this month's average.

OMV typically accounts for around 40% of Russian gas flows through Ukraine, equating to approximately 17 mcm per day.

One of Russia's remaining major gas routes to Europe, the Soviet-era Urengoy-Pomary-Uzhhorod pipeline through Ukraine, is set to close at the end of this year. This is because Kyiv has decided not to renew a five-year transit agreement that delivers North Siberian gas to Slovakia, Czechia and Austria.

Without Austria, only two European countries will receive significant volumes of Russian gas: Hungary and Slovakia. In Hungary's case, the gas is delivered via a pipeline that primarily runs through Türkiye.

Reuters reported that in 2023, Russia transported approximately 15 billion cubic metres of gas through Ukraine, accounting for about 8% of the peak Russian gas flows to Europe via various routes in 2018-2019.

The International Energy Agency estimates that in 2023, the Ukrainian transit route supplied 65% of the gas demand in Austria and its eastern neighbours, Hungary and Slovakia.

Background: The European Commission has raised its expectations for gas prices in Europe by 9.7% this year and by 14.4% in 2025.

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