Yes, Europe Is on a Suicidal Course—Energy Crisis Worsening
June 19, 2022 (EIRNS)—If you doubted the accuracy of Russian President Putin’s characterization of the European energy policy as “suicidal,” just look at how governments are reacting to Gazprom’s recent supply cuts.
The two countries most hit by the cuts are Germany and Italy, importing 42.6 and 29.2 million cubic meters respectively. Gazprom has reduced gas flows through Nord Stream 1 to Germany by 60%, and flows to Italy by 50%. Berlin and Rome’s common narrative is that the cuts are not endangering the national energy supply, because currently, supplies are running higher than demand; of course, lowered supplies now are preventing a refilling of stocks. thus jeopardizing the national supply next winter.
According to Wood Mackenzie, quoted this week by Bloomberg, if supplies through Nord Stream 1 stop completely, the EU is under the threat of being without reserves for the peak demand period of the middle of next winter.
Take note, even the part of the government narrative saying things are OK right now does not hold up. There have been repeated blackouts in Milan in the last few days, from a 25% higher electricity demand due to high temperatures.
Moscow’s use of the gas weapon was to be expected. Despite the EU rhetoric to the contrary, EU nations are co-belligerents against Russia, by delivering weapons to the Ukrainian government. Italian Prime Minister Mario Draghi himself admitted as much in his remarks in Kiev on June 16. “We are here to help Ukraine in the war,” Draghi said.
Thus, the Europeans, who are now hit by an overwhelming force in retaliation, would be wise to negotiate a surrender in order to prevent more severe damage to their households and the economy. Instead, Rome and Berlin, as if following a common script (written in Brussels?), are planning energy cuts to companies, and “freezing for freedom” for households.
According to a five-page internal document of the German Economy Ministry, published by DPA, the German government plans the following steps: 1) A €15 billion credit from the state-owned Kreditanstalt für Wiederaufbau bank to the Trading Hub Europe to buy gas at current expensive prices exclusively for refilling stocks; 2) Compensation for companies that cut production in order to save gas that goes to refill stocks; 3) Reactivation of all coal energy plants. It is not known what may happen in regard to the three nuclear plants that remain in operation after the German government’s shift out of nuclear, which are scheduled to be closed at the end of this year.
In Italy, Green Transition Minister Roberto Cingolani is preparing similar measures: 1) Cuts to producers, initially on “invitation” by national provider Snam; 2) Full use of the six available coal energy plants; 3) Reduction by 1-2°C the temperature for heating in households and public offices, with regulations for time zones in which heating can be switched on; 4) Reduction of public illumination for population centers and roads. Additionally, measures similar to those introduced during the 1973 oil shock could be contemplated, for example, traffic-free Sundays, etc.