July pipeline outages and German gas market

Norwegian seasonal outages had barely ended, when a period of maintenance at the two key pipelines delivering Russian gas to Germany began. The three-day shutdown of Yamal route was almost imperceptible for that country’s market. Meanwhile, the planned interruption of supply via Nord Stream, which is going through much longer and more extensive maintenance, has already made adjustments not only in the current situation but also have had an impact on preparations for the winter season.

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With Nord Stream being stopped for about two weeks starting 13 July, Gaspool prompt contracts rose to be at a premium to the TTF early last week. Given the minimum cost of gas transportation to the neighbouring country, the Netherlands immediately reacted to the changing balance in the German market. Before the maintenance started, H-gas had been generally imported to the Dutch area from Germany, but in recent days flows flipped to net exports.

Apart from the Netherlands, German volumes has become less available for other buyers. Since mid-July, the Czech Republic, also being one of the busiest export destinations for Germany, has sent more gas to Gaspool than it has been imported from that area.

This year’s Nord Stream works have been spiced up with the European low gas stocks. Injection rates into the German UGSs have significantly declined amid the maintenance, with CEE storages being affected as well. Between 13 and 17 July, only 14 mcm was injected into the Austrian, Slovakian and Czech facilities combined.

According to the calendar of maintenance works impacting pipeline deliveries to Europe via different routes during the remainder of summer 2021, the unavailability of Nord Stream should be the last major obstacle for the refilling NWE gas storages. But plans and reality may be two different things. Over the last two years, which has made players more prepared for surprises of all kinds, that truth has become more relevant than ever.

Source: Yakov Grabar

See original post by Yakov at LinkedIn.