Leaks were discovered on two pipelines which run under the Baltic Sea near the island of Bornholm in Denmark — they are suspected to be the result of an act of sabotage — and although it is not the only reason why the price of natural gas in Europe has become more expensive as a result, it has been a contributing factor.
Sabotaged Pipelines Result in Natural Gas Prices Increasing in Europe?
The leaks have only further exacerbated the energy crisis which Europe is facing this coming winter. Nord Stream is the operator of the affected pipelines.
This press release was added to the official Internet web site of Nord Stream on Tuesday, September 27, 2022:
The significant pressure drop caused by the gas leak on both lines of the gas pipeline registered yesterday leads to a strong assumption of the pipeline physical damage.
Nord Stream AG immediately informed the relevant coast guards about the incident. The positions of two assumed damages have been identified and are located north-east from Bornholm in Swedish and Danish EEZ, respectively.
Currently the Swedish and Danish maritime authorities established a 5nm safety zone around the identified locations (Nautical information | Danish Maritime Authority (dma.dk)).
Nord Stream AG has started mobilization of all necessary resources for a survey campaign to assess the damages in cooperation exchange with relevant local authorities. Currently, it is not possible to estimate a timeframe for restoring the gas transport infrastructure. The causes of the incident will be clarified as a result of the investigation.
This press release was added to the official Internet web site of Nord Stream on Thursday, September 29, 2022:
Nord Stream AG intends to start assessing the damage to the pipeline as soon as it receives necessary official permits. Access to the area of incidents may be allowed only after the pressure in the gas pipeline has stabilised and the gas leakage has stopped.
Until the completion of the damage assessment, it is not possible to predict the timeframe for restoration of the gas transmission infrastructure.
Energy prices have increased substantially in Europe primarily because Russia has reduced the amount of supply of natural gas to the continent amid tensions over the invasion of Ukraine by military forces of Russia — as well as sanctions which were imposed on Russia by the European Union. This, in turn, has caused many entities to suspect that Russia is behind the nefarious sabotage of the pipelines.
Entertainment venues are already feeling the pain. For example, the following paragraph is part of this official public statement which was released by the Hungarian State Opera on Monday, August 8, 2022 with regard to its schedule:
As part of the Hungarian government’s comprehensive economic measures in relation to the war in Ukraine, the ministry maintaining the Hungarian State Opera House gave notice of the reduction of 600 million HUF from the theatre’s annual budget. As a result of previous and further expected measures for savings, OPERA expects a total budget reduction of 1 billion HUF for the year 2022 and 500 million HUF for the year 2023. The recent increase in utility costs and vulnerability to currency exchange rates have placed additional burden on our theatre.
Moreover — as natural gas prices are approximately ten times higher than a year ago — the owners of hotel and resort properties may be forced to decide to pass on the additional costs for heat and lights to guests despite already charging their guests rates which have been higher than average. This means that room rates will likely be even more expensive in many parts of Europe this winter.
Natural gas is not the only type of energy which is substantially increasing in price, as oil has become more expensive as well: “The third complex is concerning Russian oil. As you know, Russia is using the profits from the sale of fossil fuels to finance its war”, according to this official statement by Ursula von der Leyen, who is the current president of the European Commission. “Concerning Russian oil, you might recall that we have already agreed to ban seaborne Russian crude oil in the European Union as of 5 December. But we also know that certain developing countries still need some Russian oil supplies, but at low prices. Thus, the G7 has agreed in principle to introduce a price cap on Russian oil for third countries. This oil price cap will help reduce Russia’s revenues on the one hand and it will keep global energy markets stable on the other hand. Today, in this package, here, we are laying the legal basis for this oil price cap.”
Final Boarding Call
Citizens of the United States may currently enjoy a strong dollar when purchasing products and services in Europe — but the high price of energy in general will offset at least some of those savings.
Many people in Europe fear that this coming winter will be a long one with utility costs forecast to be at record high prices…
Photograph ©2022 by Brian Cohen.
