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    Gazprom slashes non-FSU exports by 41% this month


The company says it is still complying with contractual supply obligations.

by: Joseph Murphy

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Gazprom slashes non-FSU exports by 41% this month

Russia's Gazprom reduced exports to countries outside the former Soviet Union (FSU) by 41.1% year on year in the first half of January, the company reported on January 17. But the company noted it was still complying with its contractual supply obligations.

Gazprom sent only 5.4bn m3 to non-FSU countries during the 15 days, compared with 9.1bn m3 during the same period in 2021. At the same time its production was stable at 23.1bn m3, up 2.1% year on year, while domestic supplies were 3.7% higher. Deliveries to China via the Power of Siberia were 50% higher than a year earlier.

"The company's gas deliveries are carried out as requested by consumers in line with contractual obligations," Gazprom said, without giving any reasons for the sharp decline in European deliveries.

Despite Gazprom's announcement, TTF futures have been stable on January 18, with the February delivery contract trading at only 0.4% above the level in the previous session at €77.3 ($88)/MWh, as of 13:00 GMT. Gas prices have fallen this month from record heights in December, on the back of warmer weather and an influx of extra LNG. 

Storage levels are still a source of concern, however. Gas Infrastructure Europe estimates that EU and UK gas storage facilities are currently 46.8% full, down 0.5 percentage points from the level on January 17.

The significant drop in Russian supplies to Europe this month cannot be explained by production constraints, Thierry Bros, professor at Sciences Po Paris, tells NGW. The unanswered question, he says, is why Gazprom's European customers seem to be only requesting the minimum contractual volumes. It is possible that Gazprom has informed them they cannot ask for additional supply, he says.