Gazprom lowered economic hopes after Ukraine grain deal

  • Gazprom says that stopping the turbines will increase gas cuts for Germany
  • Ukraine hopes to ship grain this week
  • Moscow denies fears that the deal could go off track

Kyiv (Reuters) – Russia dealt a new blow to European countries over its support for Ukraine on Monday, saying it would further cut gas supplies through its largest gas link with Germany.

The move came as the first ships to export grain from Ukraine’s Black Sea ports under an agreement agreed last week could sail within days, bringing a measure of hope to countries that depend on such food supplies even though the situation remains cloudy. Lack of confidence and potential. Risk.

Both developments showed how the conflict – now in its sixth month with no solution in sight – is having an economic impact far from the battlefields of Ukraine.

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On the front lines, the Ukrainian army reported widespread Russian artillery shelling in the east during the night and said that Russian forces were preparing for a new attack on the city of Bakhmut in the Donbass industrial region.

Russian President Vladimir Putin warned the West earlier this month that sanctions imposed on his country over its invasion of Ukraine could lead to massive increases in energy prices for consumers around the world.

On Monday, Russian energy giant Gazprom (GAZP.MM)saying it was operating under the instructions of the industry watchdog, and said flows through the Nord Stream 1 pipeline would drop to 33 million cubic meters per day from Wednesday.

This is half of the current flows, which is already only 40% of the normal capacity. Before the war, Europe imported about 40% of its gas and 30% of its oil from Russia. Read more

The Kremlin says the gas outages are caused by Western maintenance issues and sanctions, while the European Union has accused Russia of resorting to energy blackmail.

Germany said it saw no technical reason for the latest cut.

Politicians in Europe have repeatedly said that Russia may turn off gas this winter, a move that would push Germany into recession and drive up prices for consumers already facing painfully high energy costs. The Kremlin said Moscow was not interested in a complete halt to gas supplies to Europe.

grain ships

Rising energy prices and a global wheat shortage are among the far-reaching effects of Russia’s invasion of Ukraine. They threaten millions in poor countries, especially in Africa and the Middle East, with starvation.

Ukraine said on Monday it hoped a UN-brokered deal to try to ease food shortages by resuming grain exports from Black Sea ports this week will begin to be implemented.

Officials from Russia, Turkey, Ukraine and the United Nations agreed on Friday that there would be no attacks on merchant ships passing through the Black Sea to Turkey’s Bosphorus Strait and in markets.

Moscow shrugged off fears that the deal could be derailed by a Russian missile attack on the Ukrainian port of Odessa on Saturday, saying it only targeted military infrastructure.

The Russian Black Sea Fleet has prevented grain exports from Ukraine since the invasion of Moscow on February 24.

Moscow denies responsibility for the food crisis, blaming Western sanctions for slowing its exports of food and fertilizer, and for Ukraine to mine mines in its ports.

Under Friday’s agreement, pilots will guide ships along safe channels. Read more

A Ukrainian government official said he hopes the first shipment of grain from Ukraine will be shipped from Chornomorsk this week, with shipments from other ports within two weeks.

“We believe that in the next 24 hours we will be ready to work on resuming exports from our ports,” Deputy Infrastructure Minister Yury Vaskov told a news conference.

A UN spokesperson, speaking in New York, said the first ships could move in within a few days. He said the Joint Coordination Center will communicate with the shipping industry and publish detailed procedures for ships in the near future. Read more

During a tour of African countries, Russian Foreign Minister Sergei Lavrov said there were no obstacles to the export of grain and nothing in the agreement would prevent Moscow from attacking Ukraine’s military infrastructure.

The Kremlin also said the United Nations must ensure that restrictions on Russian fertilizers and other exports are lifted for the grain deal to succeed.

Before the invasion and subsequent sanctions, Russia and Ukraine accounted for nearly a third of global wheat exports.

Airstrikes

Putin describes the war as a “special military operation” aimed at disarming Ukraine and rooting out dangerous nationalists who he says threaten Russia’s security. The Kyiv government and the West call this a baseless excuse for an aggressive land grab.

Thousands of people were killed – many of them civilians – and several million fled their homes to safer areas in Ukraine or abroad.

Artillery shells and Russian air strikes destroyed entire cities. With Western arms supplies boosted to the Ukrainians, Putin’s forces are making slow progress, but they are believed to be preparing for a new push in the east.

Ukraine said on Monday its forces had used US-supplied HIMARS missile systems to destroy 50 Russian munitions depots since receiving the weapons last month. Russia has not commented, but its Defense Ministry said its forces destroyed an ammunition depot for HIMARS systems. Read more

The Ukrainian General Staff said in its evening report on Monday that Russian warplanes bombed targets in Donetsk province, including near the Vohlijerska thermal power plant.

Reuters was not able to independently verify the Russian or Ukrainian statements.

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Reporting by Reuters offices. Writing by Philippa Fletcher and Angus McSwan; Editing by Gareth Jones, Barbara Lewis and Alison Williams

Our criteria: Thomson Reuters Trust Principles.

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