MOSCOW: At a time when prices in global gas markets have risen to extremely high levels over the past few months, the uncertainty surrounding the launch of Nord Stream 2 is lingering and has become even more tense.
On Aug. 18, rumors began circulating in the market, which were not later confirmed though, that Nord Stream 2 had allegedly been already launched and natural gas had started flowing through the pipeline into Germany’s territory.
On these rumors, the gas price in the European gas market plunged swiftly only to recover shortly thereafter. In addition, the next day (Aug. 19) Interfax said, citing Gazprom, that “up to 5.6 billion cubic meters of gas may be pumped through Nord Stream by the end of 2021.”
This implies the pipeline will be largely commissioned mid-November, should the construction works and certification proceed as planned, analysts of Moscow-based Alfa Bank said in a note issued Aug. 20.
On the other hand, the US imposed new sanctions on a Russian vessel involved in the Nord Stream 2 gas pipeline on Aug. 20, Reuters said citing a statement by US Secretary of State Antony Blinken.
Moreover, Ukrainian President Volodymyr Zelensky reiterated his country’s opposition to the commissioning of Nord Stream 2 after his meeting with Chancellor Angela Merkel last Sunday.
An unusually low level of gas inventories in Europe which fell to 16 billion cubic meters or 20 percent below the five-year average as of Aug. 16 was an additional factor driving gas prices up both in Europe and Asia recently.
In a note issued earlier this month analysts of Bank of America Securities speculated “Russia has declined to export additional volumes to Europe as it hopes to push Nord Stream 2 over the finish line.”
Anyway, it seems gas prices have reached their peak already and given the renewed concerns about the lingering pandemic the gas market is looking for some excuse to get a relief, like the proposed launch of Nord Stream 2, and will eagerly welcome more supply and lower prices.