We warned about this as for months it appeared likely that Russia would not resume the same, or any, level of gas flow to Germany, potentially crippling the European Union (EU) via its economic powerhouse.
From July 27 and onward, Russia says, another turbine at NS1's Portovaya compressor station will need to be halted "taking into account the technical conditions of the engine."
"This means that as had been whispered much of last week, gas flows from Portovaya will drop to as much as 33 million cubic meters per day from 7am Moscow time on July 27, which means flows along NS1 will decline by half, from 40% of capacity to just 20%," reports Zero Hedge about the matter.
Bloomberg energy expert Javier Blas says that 20 percent flow capacity for NS1 will not be enough to keep Germany powered throughout the entire upcoming winter "unless big demand reductions are implemented."
"Berlin will need to activate stage 3 of its gas emergency program," Blas tweeted about what he describes as an energy crisis for Europe's largest economy.
Unless large numbers of people die – which could happen if those who got jabbed for the Wuhan coronavirus (Covid-19) lose their immunity and perish once flu season arrives – Germany will simply not be able to keep the lights on moving forward.
"Translation: unless Putin changes his mind, Germany is facing not just a freezing winter, but a bitter recession," the Hedge adds. "Needless to say, Germany was not happy with the latest reminder who holds all the cards in Europe."
Germany's economy ministry claims there is no technical reason why NS1 needs to remain at only a 20 percent flow rate versus the former 40 percent flow rate. The sanctions-related conditions for approval of delivery for the repaired turbine have been met, the department added.
Unless flows are returned to 40 percent, Germany will not be able to fill its gas reservoirs to 95 percent in November, which is the target level established by the government.
The result of all this in the markets is yet another kneejerk spike in natural gas prices, which means more inflation and more economic havoc. A recession for Germany is basically now inevitable, just as it is for the United States and likely the entire world.
The European Central Bank (ECB) cannot cut interest rates without sending inflation even higher, but it also cannot keep hiking rates with Europe now in a recession.
"The euro, which jumped late last week on some naive optimism that a worst case could be avoided, slumped," the Hedge further added.
In the comment section, someone spelled it all out plainly as to what Germany and the EU have done to themselves throughout this entire saga.
"Europe has basically declared military and economic war on Russia but begs Russia to keep the natural gas spigots turned on," this person wrote. "Winter is coming ... and Europe is gonna freeze in the dark to 'stick it to Putin.'"
"Reminds me of an old ethnic joke of a 'European' soldier putting a gun to their head and threatening to shoot themselves if their enemy doesn't surrender," responded another about how silly and ridiculous Germany and the EU are.
More related news coverage about the NS1 situation can be found at FuelSupply.news.
Sources for this article include: