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Russian Gas Disruption Spreads Across Europe


Russian Prime Minister Vladimir Putin (left) meets with Gazprom chief Aleksei Miller.

Russian Prime Minister Vladimir Putin (left) meets with Gazprom chief Aleksei Miller.

MOSCOW (Reuters) -- Russia has sharply cut natural-gas flows to Europe via Ukraine in a dramatic worsening of a pricing dispute with Kyiv that threatened to disrupt supplies as far west as Italy and Germany.

Russian export monopoly Gazprom said it supplied some 65 million cubic meters (mcm) to Europe on January 6 through ex-Soviet neighbor Ukraine, a fall of 78 percent from the 300 mcm it had been shipping since the dispute erupted on January 1.

The European Union, dependent on Russia for a quarter of its gas, urged Moscow and Kyiv to find a solution this week and German Economy Minister Michael Glos said it was very important the two sides began negotiations.

The head of Ukraine's state energy firm said he would fly to Moscow on January 8. Gazprom said it was ready to talk any time but did not expect Ukraine to return to the negotiation table for now.

The escalation in the price dispute and severe cold weather on January 6 drove the British natural-gas market, Europe's biggest and most liquid gas market, to its highest level since October.

GDF Suez said Russian gas supplies to France had plunged 70 percent, though the eurozone's second-biggest economy is less vulnerable than Germany and Italy, as 80 percent of its electricity is produced by nuclear energy.

Hungary, Bulgaria, Turkey, Macedonia, Greece, and Croatia said Russian gas flows via Ukraine had halted, creating what Bulgaria called a "crisis situation" in the middle of winter.

EU members Austria and Romania said deliveries were down 90 percent and 75 percent, respectively, and German energy firms warned there could be gas shortages in Europe's biggest economy if the dispute dragged on and sub-zero temperatures persisted.

"Even our possibilities will reach their limits if these drastic cuts in shipments last and if temperatures continue to stay at very low levels," E.ON Ruhrgas Chief Executive Bernhard Reutersberg said.

Gazprom can only guarantee gas supplies to Italy of 7 million cubic meters on January 6, or less than 20 percent of the expected amount, an Italian source close to the matter said. The industry ministry earlier said Rome planned to increase gas imports from alternative suppliers.
Pipelines & Projects

A factbox on how gas gets to Europe from Russia and some of the new pipeline projects aimed at bringing more Russian gas to Europe and diversifying supplies. More

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