As Russian gas flows resume, wholesale gas prices in Europe fall.

After the Russian gas flow resumed to Germany on Tuesday, wholesale gas prices in Europe fell. This raises hopes that Moscow is fulfilling a promise to increase supplies and reduce concerns about high prices and shortages before winter.

Russia began pumping gas to Germany late Monday night via a pipeline that runs from Yamal, Siberia. This was a day after European exports were stopped. German data revealed that the gas flows rose to their highest point in nearly two weeks.

Russia supplies a third of Europe’s gas, and its supply intentions are crucial at a time where spot prices have risen and hit both households and businesses in Europe. This underscores Europe’s dependence on Moscow for its energy supplies.

Russian President Vladimir Putin directed Gazprom, the state gas company Gazprom, to increase its supplies to Europe this month and to rebuild its stocks there once domestic storage tanks have been refilled.

Gazprom announced Tuesday that it has begun pumping gas to five European underground storages in preparation for the November order.

Although wholesale prices in the European Union countries and Britain were lower, analysts on the market said that a greater drop in prices would be dependent on Russia’s efforts to alleviate European concerns and how cold it is.

Trevor Sikorski, an analyst with consultancy Energy Aspects, stated by email that prices will remain high until these concerns are resolved.

Dmitry Marinchenko (senior director at Fitch ratings agency) stated that Gazprom would have to pump approximately 170 million cubic meters (mcm), more gas per day for a month to replenish its European storage. This is an increase of around a third of what it is shipping right now.

Marinchenko stated to Reuters that Gazprom would need to reserve additional transit capacity through Ukraine in order for such a significant increase in supplies. The Nord Stream 1 (pipelines), and Yamal Europe (pipelines) would not suffice.

Officials from the Ukrainian gas transmission network said Gazprom requested to ship 100.2 million cubic meters per day through Ukraine. This is lower than the 110 mcm per daily it has already paid, but more than the 56-64 mg cm per day seen at the beginning of November.

Gazprom must reserve additional capacity separately through Ukraine and for Yamal-Europe pipeline auctions if it wants to exceed the contracted volumes. Recent auctions have not allowed it to do so.

Russia denies withholding gas supplies to Europe in order to pressure German regulators to allow gas shipments via the Nord Stream 2 gas pipeline below the Baltic Sea. Germany has until January 1st to approve the pipeline.


This year, gas prices rose due to factors such as low inventories of gas and increased demand after the economic recovery following the lifting of COVID-19 lockdowns. Also, tighter-than-usual Russian supplies have contributed to this increase in gas prices.

Some energy companies in Britain have gone bankrupt, and consumers now have much higher energy bills. Companies from many industries, including agriculture, have also felt the pinch.

The Westbound flow into Germany from Poland at the Mallnow metering station on Poland’s frontier was resumed late Monday with an hourly volume exceeding 3 million kilowatt-hours (kWh)

Tuesday’s volume reached 9 million kWh/hour, which is the highest level since Oct. 29, when it was at its highest.

For Tuesday, the Renominations (or requests to transport gas) into Germany stood at 9,742,667kWh/hour. The data revealed that exit requests for gas to be sent into Poland were lower at 1,013,000kWh/hour.

Customers can request that flows be adjusted on the Yamal Europe pipeline. Last week there were reverse flows, which meant that gas from Germany was flowing into Poland. For most of Monday, there were no net flows.

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