With winter just around the corner in budgeting terms, Russia made a strategic but devastating move on July 25th, as Russia’s state-owned gas company Gazprom claimed they would cut the stream of gas that is pushed through the Nord Stream 1 pipeline to Germany in half. This now plummets them to just 20% of its capacity and puts Germany in a tough spot.
This cut in gas production is a byproduct of the Russian response to Western sanctions. The Russian mindset of forcing Europe to make their energy needs without their involvement is not only a challenging one, but it has also given President Biden some horrible ideas. One of which has been to reach into the US strategic reserve to supply the European Union with gas and oil to supplement the Russian shorting of their supply.
A cut in use like this tests the resolve of the European Union and forces the EU members to conserve their gas use so they will have a supply come in the wintertime. Energy ministers from across the union agreed in principle that a 15% cut from August to March would be enough to make it through.
Surviving a drop in supply like this without raising the rates on their customers to levels that would leave them broke and unable to afford other necessities to live will take some severe conservation on the user’s end. In response, they are also looking into increasing the production of their nuclear plants.
It’s interesting to watch how quickly President Biden has struck to help the European Union with their dependency on Russia, but he continues to state that he cannot do anything about the US gas and oil supply. That the federal government cannot help in our situation, but we can help other nations. If anything, this reinforces the notion that he is intentionally crippling our economy at every turn.
After the Russian invasion back in February, Germany started doing their part by dropping its plans for the Nord Stream 2. This pipeline was proclaimed to only be for commercial use, but the US argued with German officials that it would do nothing but increase their dependence on Russian fuels. With all the back and forth, the US decided it could proceed without US sanctions, but they scrapped it anyways.
An unnamed National Security Council spokesperson recently classified the Russian strategy at this point as “to use natural gas as a political and economic weapon.” Given their history of lashing out at people, this wasn’t unexpected by anybody. Especially with Western sanctions being placed on Russia.
“Russia’s energy coercion has put pressure on energy markets, raised prices for consumers, and threatened global energy security. These actions only underscore the importance of the work the United States and the European Commission are doing to end our reliance on Russian energy. We will continue working with our European partners to reduce dependence on Russian energy and support their efforts to prepare for further Russian destabilization of energy markets.”
Given the situation in Europe because of the sanctions, people have been paying through the nose even more than in years past. It’s also been a lesson in what not to do. Being dependent on a singular nation for your entire supply is not only poor planning, but it also sets you up for failure by being under their thumb. Other nations like Canada could be helping as well, but so far it’s largely been crickets, with the US playing global savior. Much to the detriment of their people, yet again.