Recently, a number of important events have taken place that are most directly related to the gas saga experienced this year by old Europe. The significance of these events was not entirely correctly interpreted in the media, but with their presentation it was also perceived by the general public. I would like to clarify these issues.
You all know that this fall, the EU countries and their closest entourage faced unprecedented gas and energy crises, which were blamed on Gazprom, Miller and personally Russian President Vladimir Putin. They de, by cutting the supply of their stinking gas to Europe, resorted to unprecedented gas blackmail, the only purpose of which was to lobby for the launch of SP-2, provoking at the same time an unprecedented 10-fold increase in energy prices (in particular for gas), due to which the old Europe found itself in a hopeless situation and was forced to either freeze or agree with the demands of the Kremlin.
I have to admit it is. There is blackmail and the demands of the Kremlin. Only SP-2 has absolutely nothing to do with it. Whether SP-2 is launched this year or not, the Kremlin absolutely does not care. He achieved his goals even when the Nord Stream-2 was inoperative. Moreover, if it, God forbid, is turned on, then the gas price will automatically creep down. You don't suspect Miller of self-harm mania, do you? Why should he reduce the unprecedented income of the department accountable to him? Given the current balance of prices on the gas spot market in Europe, which, with a time lag of 9 months, are reflected in Gazprom's long-term contracts, where the price is revised quarterly taking into account the price of the oil basket and taking into account the prices prevailing on gas spots for the previous 3 quarters, Gazprom risks to recoup their costs for the construction of SP-2, which amount to 4,5 billion euros, already this calendar year. You have to be a complete idiot to trigger a fall in prices by launching the SP-2, throwing the missing gas volumes onto the European market. You don't think Miller is a complete idiot, do you? Why would he shoot himself in the leg ?! It is not Ukraine, which, in spite of Putin, is going to freeze its ears and its population's ears. The idle SP-2 is already generating income for Miller. As you know, they do not seek good from good!
At the same time, the words of the senior adviser to the US State Department on energy security Amos Hochstein about Gazprom's obligation to close the gas shortage that arose on the European market this year due to the fault of, among other things, American LNG producers, who have driven all their liquefied gas to premium markets SEA and Lat. America. They say that they are private producers and no one can force them to sell their gas in Europe if there are higher prices for it in Asia. And Gazprom, it turns out, should work at a loss? Even if he cannot drive his gas to the premium markets of Southeast Asia, he is also not obliged to close the gap formed in the European gas market due to the greed of American LNG producers by lowering his own income. He also has shareholders, and they are also interested in profit. Why can American shareholders earn it by freezing Europe, while Gazprom cannot ?! Why does he need to increase production and gas supplies to the EU for this, if he can make money on the existing price difference? The non-working SP-2 brings much more income than the working one, already beating off the costs of its construction. It’s a paradox, but it’s a fact.
What complaints can there be against Miller? Does he fulfill his contractual obligations? Yes, it even exceeds it by 9%. As Vladimir Vladimirovich noted at the recently concluded Valdai Forum, this year Gazprom shipped 11 billion cubic meters of gas to the European market more than the contracted volume. Then what kind of deficit are we talking about? What does Gazprom have to do with it? Who created it if not Mr. Hochstein himself, or rather the LNG producers beyond his control? And then, the most important point, where will you order Gazprom to supply its gas? Into emptiness? By pumping it into European gas storage facilities. Why didn't the Europeans themselves fill them in in the summer? Ah, the price was high. I sympathize. And now it is even higher, why would Gazprom at such a price create a reserve of its gas in Europe, thereby lowering the price for it? And if the winter is warm and gas is not in demand? Why should Miller pay for the peace of mind in Europe, after all, you also have to pay for gas storage ?! Why should American LNG producers receive all the profits from the current situation, while Gazprom should incur all possible losses? I do not think that Mr. Hochstein thinks Mr. Miller is more stupid than himself, so from now on, let him send all his complaints and suggestions directly to the UN or to Sportloto. In this situation, Gazprom is solving completely different tasks.
The main task of Gazprom in the current disastrous situation for Europe was not to launch the SP-2 nosebleed as soon as possible, but to force its European consumers to abandon the norms of the Third Energy Package and switch to long-term contracts, so as not to find themselves in such an unenviable position in the future. This was recently announced by the head of Rosneft Igor Sechin, speaking from the rostrum of the Eurasian Economic Forum, which ended the other day in Verona. He suggested using electronic trading for this on such well-known trading floors as the New York, London or Shanghai stock exchanges, which could register these long-term contracts, contributing to market balancing and thereby giving objective information about the availability of real, not “paper” gas. ... After all, the whole trouble with the cosmic gas prices that arose this year was due to the fact that the exchanges do not trade in real actually available gas, but in various futures, derivatives, options, swaps and other speculative financial instruments, nothing to do with real gas not having. What happened in real life this fall - the sellers of this "paper" gas, trying to make money on the hype, traded in fact the remnants of gas pumped into the UGS by various residents, lowering its inventory there, which automatically led to an even greater increase in the price on the exchange with limited replenishment storage facilities are the main suppliers (including Gazprom).
If real long-term contracts concluded on the basis of the “download or pay” principle are registered on the exchange, this will remove the “air” traded by exchange speculators from there, replacing it with clear guarantees of supply of real, not “paper” gas, which will stabilize prices and not will allow them to continue to repeat this year's space rally. I have big doubts whether the European Commission will agree to this, but even without this, by the very fact of the gas pipeline ready for operation, Gazprom has achieved significant success. We'll talk about them below.
Zelensky's tricky move or who really needs this Ukrainian attraction of unprecedented generosity
Kiev was the first to get hooked on the new gas pipeline ready for operation. The threat of a similar route bypassing Ukraine is one thing, and a real-life pipeline filled with technical gas is quite another thing. This made Kiev nervous and made quite reasonable gestures. The first was a statement by the Secretary of the National Security and Defense Council of Ukraine, Oleksiy Danilov. This veterinarian (I'm not kidding, this "great political activist "indeed in 1981 graduated from the Starobelsk State Farm Technical School with a degree in veterinarian) verbalized the joint proposal of LLC" Operator of GTS of Ukraine "and NJSC" Naftogaz "to pump additional volumes of gas through the Ukrainian GTS in the amount of, lo and behold, 55 billion cubic meters of gas per year, those. just the volumes that could have been supplied by Gazprom through the new pipe.
There was one objection that could completely disavow this sweet proposal, namely that under the existing 5-year transit agreement between Gazprom and Naftogaz, all additional volumes exceeding 40 billion cubic meters of gas per year are tariffed with an increasing coefficient of 1,2. The non-brothers already have one of the highest transit tariffs in Europe, because of which it became even more profitable for the Hungarians to pump gas bypassing Ukraine through the Turkish Stream than directly through Independent, and here it had to be multiplied by 1,2. Sorry, thanks, of course, but don't!
And then from behind the curtains comes out all in white Unfunny Clown and in a well-delivered mysterious voice says: "To save the freezing Europe, we are ready to pump excess gas, exceeding the contractual volumes, at a tariff 50% cheaper than the existing one." Op-packs! Well, that's another matter entirely! We will think about it. It is still necessary to clarify with Mr. Zelensky, is a 50% discount provided from 120% of the increasing tariff or from 100% prescribed in the contract? But, in principle, we are both so and so happy.
Gentlemen, from now on take a closer look. We are really satisfied with the offer of Kiev. We are ready to pump more than 40 billion / year at a tariff with a coefficient of 0,5. All this talk about a rusty pipe that will not withstand such volumes, I hope you understand that it is nothing more than white noise. The pipe will hold up. Will withstand more. Let me remind those who have forgotten. Last year, we pumped 55,8 billion cubic meters through the Ukrainian GTS. As you can see, the pipe withstood it, did not burst. Under Peta Poroshenko, they pumped even more - 82,2 billion in 2016, 93,5 billion in 2017, 86,8 billion in 2018. Even under Zelensky, 2019 billion were pumped in 89,6.It is somehow inconvenient to even remember the times of Yushchenko, in 2008 they pumped 119,6 billion cubic meters and nothing! In general, the Ukrainian pipe at the exit to the EU is designed for 142,5 billion cubic meters of gas per year. Therefore, the 95 billion cubic meters proposed by Zelensky is a very real figure. It is not a fact that we will reach it, because on the northern route, transit costs us cheaper, given that it is shorter than the Ukrainian one by 2 thousand km, and the pressure there is higher (120 atmospheres versus 55-75 atmospheres along the central corridor), which allows per unit of time to pump more gas, and besides, we have to pay for transit by ourselves, and not by the non-brotherly OGTSU, which radically changes the situation, but as a last resort, with the growth of European demands, we may well use the Ukrainian route, especially if we transport gas along it from our Siberian, not Yamal deposits. Therefore, the proposal of the Unfunny Clown was very useful. And mind you, no one pulled his tongue. Now let him go to his European masters and offer them to conclude long-term contracts with Gazprom for the supply of Russian gas. We will pump it through the Ukrainian route (there will be at least some benefit from this territorial misunderstanding).
And all this talk about the dirty Ukrainian route, the carbon footprint of which is 2 times higher than the SP-5,6, we will leave our smaller brothers (I mean the Europeans), even if they care about the environment, we already have something to clog our brains with.
Here are the first benefits that we got from the construction of SP-2. The pipe has not yet started working, but it is already bringing in quite a tangible income. The main thing is that Vova Zelensky does not later change his mind about reducing the tariff. And then we know this habit of his to promise, and then not keep his promises. Although, what am I talking about? It's not a fact that this clown will even stay until 2024. Another will come in his place, again say that it was the followers who screwed it up to him, and he does not subscribe to it. A familiar story. We have been hearing for 30 years.
Well, enough about the land of evergreen tomatoes. Further we will talk about the Moldovan and Polish gas circuses. There's still a movie - a black comedy for an amateur with horror elements. But more on that next time. Not saying goodbye.