Putin cuts gas to Europe as energy war escalates
Vladimir Putin has imposed an indefinite shutdown of the Nord Stream pipeline supplying gas to Europe, as a proxy energy war between the Kremlin and the West escalates.
State gas giant Gazprom said Friday night that the Nord Stream 1 gas pipeline to Germany would not reopen after maintenance as planned, despite market data earlier suggesting flows would resume on Saturday.
Gazprom blamed an oil leak for the delay but gave no timetable for reopening. Russia has been accused of weaponizing gas supplies in retaliation for sanctions, pushing Europe into a cost-of-living crisis and raising fears of rationing.
News that flows would not restart came hours after the G7 confirmed plans to cap Russian oil prices in a bid to cripple the Kremlin in its war on Ukraine.
The club of industrial powers, which includes the United States and the United Kingdom, said it would “stand with Ukraine for as long as it takes” in unveiling the measure after talks in Washington.
Nadhim Zahawi, UK Chancellor of the Exchequer, said the G7 was “united against [Russia’s] barbaric aggression”, adding that he “will do everything in his power to support Ukraine”.
Moscow hit back, saying it would halt oil sales to countries imposing the cap, which it said would destabilize global oil markets.
“We simply won’t cooperate with them on non-market principles,” Kremlin spokesman Dmitry Peskov said.
Under oil price cap measures, Western-dominated services such as insurance and shipping finance will only be allowed if Russian oil cargoes are purchased at or below a certain price level .
The level of the ceiling has not yet been fixed and will be determined later on the basis of the “technical contributions” decided by the countries concerned.
Christian Lindner, German finance minister and current G7 chairman, said the move would reduce Russia’s revenue while reducing inflation.
Russia is the world’s second largest exporter of crude oil behind Saudi Arabia, and in February just before its war, it was the world’s largest exporter of oil to world markets.
Brent crude surged after the invasion, peaking at over $127 a barrel in March. It fell back to around $94 a barrel, above pre-crisis levels.