Uniper says the worst is yet to come, as Russia halts gas flows to Europe

German energy giant Uniper He warned on Tuesday that the worst was still to come as concerns about Russian gas supplies to Europe during the fall and winter continued to drive prices up.

“I’ve said this several times now this year and I’m educating policy makers as well. Look, the worst is still to come,” Uniper CEO Klaus-Dieter Maubach told CNBC’s Hadley Gamble at the Gastech 2022 fair in Milan, Italy.

He added, “What we’re seeing in the wholesale market is 20 times the price we saw two years ago – 20 times. That’s why I think we really need to have an open discussion with everyone who takes responsibility for how to fix that.” .

Russian state-owned energy giant Gazprom on Friday Indefinitely stop the flow of gas to Europe Via a major pipeline, raising fears that parts of Europe may have to ration power during the winter.

Uniper, as Germany’s largest gas importer, has been hit hard by a significant reduction in pipeline gas flows from Russia, Which led to higher prices.

Uniper has requested billions in financial aid from the German government as a result of rising gas and electricity prices.

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German government In July, it agreed to bail out Uniper With a 15 billion euro ($14.9 billion) bailout deal to provide the beleaguered company some financial relief. Mobach said on Tuesday that some details still need to be ironed out with this stabilization package.

Russia’s interruption of Nord Stream 1 supplies and the subsequent rise in European gas prices are likely to exacerbate the situation for the company.

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Uniper shares were down 3.5% on Tuesday morning. The price of Frankfurt-listed shares has fallen more than 88% since the beginning of the year.

Partnership with Gazprom ‘disabled’

Gazprom’s announcement came shortly after the G7 economic powers Support plan to propose a ceiling for the price of Russian oil.

Gazprom said the shutdown was due to an oil leak in a turbine. The Nord Stream 1 pipeline, which connects Russia to Germany via the Baltic Sea, was due to reopen on Saturday after three days of maintenance.

The Kremlin has since blamed European lawmakers for halting gas supplies via Nord Stream 1, saying economic sanctions imposed by the West in the wake of Russia’s invasion of Ukraine have hampered reform work.

It has been widely interpreted as the clearest indication yet that Russia is likely to push for Europe to lift punitive economic sanctions so that the Kremlin can turn the taps on again.

European Union policymakers have accused the Kremlin of weaponizing energy supplies in a bid to sow uncertainty across the 27-nation bloc and boost energy prices amid the Kremlin’s attack on Ukraine.

Asked whether Uniper could work again with Gazprom if the Kremlin’s war with Ukraine ended, Maubach said that the company’s relationship with Russia stretched back to the 1970s and that he personally advocated Gazprom as a reliable energy supplier after the war began. With Ukraine in late February.

“That, in hindsight, was probably a mistake to think about not using gas. Maybe it was just a security reasoning,” Mobach said.

“I think this partnership is broken and I don’t think we can re-establish it in the coming weeks, months and years. Therefore, we are focused on replacing Russian gas,” he added.

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