Another postponement: Nord Stream 2 will not help Europe this winter

Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, commented to Gazeta.ru regarding the suspension of Nord Stream 2 certification.

Certification times will slow down

According to Alexey Gromov, Germany's main complaint was the legal registration of the Nord Stream 2 AG operator in Switzerland. Thus, the energy legislation of the European Union did not actually apply to the main contractor of the gas pipeline.

“The solution to this problem will not be too complicated for Gazprom. However, by January 8, the project will definitely not work at full capacity. In fact, the Russian monopolist needs to re-register the operating company in December-January. However, the main question is whether the certification procedure will be resumed taking into account the time that was spent by the German side before the presentation of comments to Gazprom, or everything will start from scratch,” the expert emphasized.

The role of Ukraine and Poland

“If the commission decides by an absolute majority to refuse to commission NS2, then the vote of Ukraine will also be taken into account. In addition, the position of Kiev will play a significant role in the discussion of the submitted documentation on the gas pipeline. In fact, in a certain scenario, Ukraine and Poland can torpedo a positive decision. Their politicized arguments can be taken into account,” Gromov said.

The expert also added that Warsaw opposes Nord Stream-2 due to its dependence on the transit of Russian gas. Only through the Yamal-Europe pipeline Poland pumps up to 10 billion cubic meters annually. Putting SP-2 into operation could drastically shorten this route.

What will happen to prices

After the decision to suspend certification of Nord Stream 2, exchange prices at the main European sites again rose above $ 1,000 per thousand cubic meters of gas. They could grow even stronger and collapse the EU energy market, if not for the stabilization of the situation with supplies to Asia.

According to Gromov, such a trend in the medium term will lead to a decrease in exchange gas prices on Asian markets. This factor, in turn, will redirect part of the volumes to European terminals.

“In Asia, the situation with the increased demand for liquefied natural gas is beginning to calm down. The peak of the energy crisis that began in China and India in September-October has apparently been overcome. Therefore, one should not expect an exorbitant rise in gas prices in Europe. The cost of fuel at the height of the heating season may be about $ 1-1.2 thousand per thousand cubic meters,” the expert suggested.