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Europe Braces For Energy Shortages

Sean Carney, The Wall Street Journal

A fall in natural gas flows from Russia to several Central and Eastern European countries this week has sent a chill through the region as it prepares for possible energy shortages this winter.

Austria’s energy regulator E-Control and oil and gas company OMV AG both said on Friday that gas shipments from Russia were down 15% from previously ordered volumes.

The decline in supplies to Austria began Thursday and was expected to continue through Friday, said Robert Lechner, of OMV’s press office.

“Until now we are not aware of the specific reasons for this,” Mr. Lechner said.

Slovakia’s gas distributor SPP said Thursday its daily gas intake from Russia fell 10% below contracted levels starting late Wednesday. Polish gas company PGNiG said its gas flows from Russia had fallen 45% below contracted daily volumes by Thursday, though the gap narrowed somewhat on Friday.

As in Slovakia and Poland, E-Control and OMV said the reduced supply of gas from Russia wouldn’t create any problems for the gas system.

Signs that Russia is already cutting supplies come as it remains at loggerheads with Ukraine over gas prices amid ongoing tension between the two countries. Moscow is demanding Kiev pay $385 per thousand cubic meters for its gas, a price the economically stressed Ukraine is unwilling to pay. Russian gas flows to Ukraine have been cut off since June.

The European Union’s Energy Commissioner Günther Oettinger on Friday proposed Sept. 20 as a date to restart trilateral talks between Russia, Ukraine and the EU on terms of Russian gas sales to Ukraine. Mr. Oettinger’s office was still waiting for a Russian response late Friday.

If a deal can’t be reached it is possible Russian supplies to Ukraine could be halted through winter—as happened during previous price disputes in 2006 and 2009. Kiev might in turn try to siphon off supplies intended for Europe for its own needs, as it did in the past. That could cause energy shortages: Russia supplies around 30% of the continent’s gas needs, half of which transits via Ukraine.

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