Russia’s Gazprom Cuts Poland Natural Gas Supply By Dimitra DeFotis Reuters A gas pressure gauge on the Slovakia-Ukraine border. Russia’s state-controlled natural gas giant Gazprom has cut supplies headed to Poland, which in turn curbed Ukraine natural gas shipments. But no other Europe-bound gas supplies are at issue, and Russian equities were otherwise rallying. U.S.-traded shares of Gazprom (OGZPY) are higher by 1%. The iShares MSCI Poland ETF (EPOL) rose 0.59%. The iShares MSCI Russia Capped ETF (ERUS) rallied 0.87%. The Market Vectors Russia ETF (RSX) rose 1.37%. As for trading vehicles: the Direxion Daily Russia Bear 3X Shares (RUSS) dropped 4%, while the Direxion Daily Russia Bull 3X Shares (RUSL) is up 3.88%. Teneo Intelligence says a complete cut-off of Gazprom’s EU customers is unlikely, given Gazprom’s need for revenue and a lack of short-term export alternatives. Partial cuts to the EU are likely, but EU customers can cover shortfalls with storage and other sources, Teneo says, adding: “Authorities in Poland reported that Gazprom reduced gas supplies to the country by more than 20% in the past 48 hours. As a result, Poland stopped reverse flow supplies to Ukraine today, which is likely the main goal behind Gazprom’s move. The risk of a complete cut-off of supplies to European countries is limited and no other country besides Poland has registered a reduction in pipeline volumes in recent days. Gazprom’s move targeted Poland, whose hawkish stance on the EU sanctions against Russia and vocal support of Ukraine is well known. PGNiG, the Polish gas company, has asked Gazprom for an explanation but has received no response so far. The reduction in supplies does not have a significant impact on Polish consumers as the shortfall has been covered from other sources. However, Ukrtransgaz (the Ukrainian gas transport company) reported that Poland shut down reverse flow supplies to Ukraine today. This appears to be the most likely reason behind Gazprom’s move, as Russia seeks to add pressure on Ukraine ahead of a new round of gas price and outstanding debt talks on 16 Sept.” The European Union is mulling more sanctions against Russia as it works out details of a cease fire with Ukraine. German Chancellor Angela Merkel voiced support of greater sanctions against Russia today.
Posted on: Thu, 11 Sep 2014 05:24:09 +0000
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