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What has already been a year from hell for Germany, which is suffering energy hyperinflation as a result of Europe’s sanctions on Russia, and which is “facing the biggest crisis the country has every had” according to the president of the German employers association, is about to get even worse as the declining water level of the Rhine river, which has historically been a key infrastructure transit artery across Germany, continues to fall and as it does, the flow of commodities to inland Europe is starting to buckle threatening to make an already historic crisis even worse.

The alarming lack of water is contributing to oil product supply problems in Switzerland and preventing at least two power plants in Germany from getting all the coal they need, and what’s more, the continent’s sizzling summer temperatures are forecast to climb even higher in the coming week, leading to even lower water levels.

The 800-mile (1,288-kilometer) Rhine river runs from Switzerland all the way to the North Sea and is used to transport tens of millions of tons of commodities through inland Europe. But with water levels at their lowest for the time of year in 15 years, there is a limit how much fuel, coal and other vital cargo that barges can carry up and down the river.

Low water levels on the Rhine River mean that barges hauling middle distillate-type oil products – typically gasoil/diesel – past Kaub in Germany, are limited to loading about 30% of capacity, according to maritime brokerage services firm Riverlake.

A barge loading in the energy hub of Amsterdam-Rotterdam-Antwerp (or ARA), which can haul 2.5k tons when fully laden, is restricted to taking on about 800 tons if sailing to destinations beyond Kaub…

…click on the above link to read the rest of the article…

Gazprom Reportedly Declares Force Majeure, Will Halt Gas Flows To Germany Indefinitely

July 18, 2022

Gazprom Reportedly Declares Force Majeure, Will Halt Gas Flows To Germany Indefinitely

Already days before the July 22 European “Doomsday” when the scheduled Russian 10-day maintenance of the crucial Nord Stream pipeline to Germany is slated to end – but which was thrown into deep doubt given Gazprom recently said it can no longer guarantee its “good functioning” due to crucial turbines being previously held up in Canada related to sanctions – the Russian energy giant has declared Force Majeure to one major European customer.

Simply put, Gazprom declared extraordinary and extreme circumstances to void itself from all contractual obligations to this customer, thus the gas will stop flowing indefinitely, as Reuters reports in a breaking development Monday, “Russian gas export monopoly Gazprom has declared force majeure on gas supplies to Europe to at least one major customer starting June 14, according to the letter seen by Reuters.”

The letter invoked “extraordinary” circumstances outside the company’s control, Reuters continues, citing a source saying the customer in question is Germany via the Nord Stream 1 pipeline.

As we’ve been detailing, German authorities have of late taken unprecedented steps in anticipation of an enduring Russian gas halt, essentially dimming the lights across the country – which has included everything from limiting hot water, to shutting down swimming pools, to quite literally dimming city street lights as it entered “alarm” stage over dwindling supply.

It seems this letter declaring its legal release from supply obligations going back to June 14 is in preparation for definitive action on July 22, namely that the pipeline’s operations are likely to remain suspended.

…click on the above link to read the rest of the article…

German Energy Giant Warns Of Insolvency “Within Days”, Starts Draining Gas From Storage

July 15, 2022

German Energy Giant Warns Of Insolvency “Within Days”, Starts Draining Gas From Storage

Dear Biden administration: for an example of a real emergency that justifies draining a commodity reserve – and not just midterm elections which Democrats will lose in a historic rout – read on.

German energy giant and distressed nat gas utility Uniper, which is among the companies most exposed to Russian natural gas, has started using gas it was storing for the winter after Russia cut deliveries to Europe, increasing pressure on Berlin as the German energy giant needs to be rescued “in a few days.”

The country’s top buyer of Russian gas started withdrawing fuel from storage sites to supply its customers, the company said in a statement to Bloomberg on Friday. The drawdowns, which began on Monday, will also help the company to save some cash as it has been forced to pay up for gas in the spot market. Meanwhile, flows through the Nord Stream 1 pipeline remain shut for maintenance.

Harald Seegatz, deputy chairman of the supervisory board, said that Uniper needs urgent help, risking insolvency within days.

“We are currently reducing our own gas volumes in our storage facilities in order to supply our customers with gas and to secure Uniper’s liquidity,” the company said. And judging by the flatlining of German gas storage in inventory, Uniper is not alone in draining reserves.

According to Bloomberg, citing data from Gas Infrastructure Europe, Uniper’s storage sites in Germany are now about 58% full, down from about 60% reached on Sunday. Drawdowns were also made from the company’s storage in Austria, but overall storage levels in Germany’s Alpine neighbor are still showing marginal increases.

…click on the above link to read the rest of the article…

Deutsche Bank Now Modeling German Households Chopping Wood To Keep Warm This Winter

July 15, 2022

Deutsche Bank Now Modeling German Households Chopping Wood To Keep Warm This Winter

Yesterday we reported that just in case the world didn’t have enough things to worry about, it is now also petrified about Europe’s potential “doomsday” on July 22 when Putin will decide the fate of the continent: if he resumes gas flows along the Nord Stream 1 pipeline which is currently undergoing ten-day maintenance, things will be back to normal(ish). If not, this is the scenario contemplated by Wall Street strategists: “European stocks plunging 20%. Junk credit spreads widening past 2020 crisis levels. The euro sinking to just 90 cents, before a full-blown recession slams the world’s 2nd biggest economy.”

Then overnight, in a note from Deutsche Bank senior economist Eric Heymann (available to pro subscribers), the largest German lender laid out the three most likely scenarios for what the post-maintenance period could look like. As Heymann writes, “we developed three scenarios on how Russian gas supplies to Germany via Nord Stream 1 as well as the transition point Waidhaus might evolve over the next few months.”

Scenario 1: Status quo ante. Here, DB assumes that Russian gas deliveries return to the level we had seen in the weeks before the current maintenance period of Nord Stream 1, i.e. 60% below the level at the end of May.
Scenario 2: Balanced on a knife-edge. Here, the bank assumes another halving of Russian gas supplies via both pipelines. That would correspond to only 20% of Russian gas supplies seen until May 2022 (this scenario was validated today as described in “Gazprom Casts Doubt On Reopening Nord Stream Even As Canada Grants Sanctions Waiver For Stranded Turbines“).
Scenario 3: This is the downside case: welcome to a winter of gas rationing. In a third scenario DB assumes that Russia completely turns off the gas taps to Germany after the maintenance period. That also includes supplies via Waidhaus over the next few months…

…click on the above link to read the rest of the article…

Germany Plans ‘Warm Up Spaces’ in Response to Gas Shortages

July 12, 2022

Germany Plans ‘Warm Up Spaces’ in Response to Gas Shortages

Sports arenas to be used to help people who can’t pay skyrocketing energy bills.

picture alliance via Getty Images

Cities across Germany are planning to use sports arenas and exhibition halls as ‘warm up spaces’ this winter to help freezing citizens who are unable to afford skyrocketing energy costs.

Bild newspaper reveals how the the nation’s Cities and Municipalities Association has urged local authorities to set aside public spaces to help vulnerable citizens in the colder months.

Germany has already seen its gas supply from Russia significantly restricted as a result of its support for sanctions and the war in Ukraine.

“We are currently preparing for all emergency scenarios for autumn and winter,” Jutta Steinruck, the city mayor of Ludwigshafen told Bild, where the Friedrich-Ebert-Halle arena is about to be converted into a warm up hall.

“Nobody can say exactly how dramatic the developments will be,” said Gerd Landsberg, the head of the Cities and Municipalities Association.

Landberg urged local municipalities to create “heat islands” and “warm rooms, where people can stay, even during a very cold winter.”

The western German towns of Neustadt, Frankenthal and Landau are also making similar arrangements, while others are planning to turn off lights outside public buildings as well as deactivating traffic lights at night to save energy.

As we highlighted last week, Germany’s largest residential landlord which owns around 490,000 properties is set to impose energy rationing that will cut heating to tenants at night in response to falling gas imports from Russia.

Germans have also been told to take fewer showers, wear more layers of clothing and avoid washing their clothes and driving their cars as often.

…click on the above link to read the rest of the article…

Entire industries in Germany could collapse due to Russian natural-gas supply cuts: union head

July 4, 2022

Entire industries in Germany could collapse due to Russian natural-gas supply cuts: union head

Germany’s Economic Minister Robert Habeck speaks to press in Dusseldorf, Germany.

Listen to The Refresh: Insider’s real-time news podcast.

Entire industries in Germany could collapse due to natural-gas supply cuts from Russia, said Yasmin Fahimi, the country’s top union official.

“Entire industries are in danger of collapsing permanently because of the gas bottlenecks: aluminum, glass, the chemical industry,” Fahimi, the head of the German Federation of Trade Unions, told Bild am Sonntag. “Such a collapse would have massive consequences for the entire economy and jobs in Germany.”

The chemical industry, which employs about 346,000 people, is the third-largest industry in Germany, according to Germany Trade & Invest, the country’s investment promotion agency.

Germany — Europe’s largest economy — is reliant on piped natural gas from Russia, which accounts for 35% of its imports of the fuel. The industrial powerhouse imports almost all of the natural gas it uses, which accounts for about a quarter of the country’s total energy mix, according to the economy ministry.

The country’s energy crisis is already driving inflation to record highs, which threatens social stability, Fahimi told Bild am Sonntag.

Russian state gas giant Gazprom has already cut gas flows to Germany via the key Nord Stream 1 pipeline by 60% from last month, citing an equipment hold-up in Canada as a result of sanctions over the war in Ukraine.

…click on the above link to read the rest of the article…

Dutch Farmers Livid Over EU’s ‘Green’ Nitrogen Rule Block Border Between Holland And Germany

July 1, 2022

Dutch Farmers Livid Over EU’s ‘Green’ Nitrogen Rule Block Border Between Holland And Germany

Thousands of tractor-driving Dutch protesters came out this week to continue demonstrations against the government’s radical plan to cut nitrogen emissions by 30% – 70% as part of their ‘green’ agenda.

Farmers from the world’s 5th largest exporter of food are demanding that the Hague immediately reverse course, and have blocked the border between Holland and Germany over the rule which would lead to the closure of dozens of farms and cattle ranches.

On Wednesday, dozens of tractors blocked a highway close to the German border, according to traffic authorities.

Even larger protests are scheduled for July 4, with organizers taking to Telegram to call people to action against rules they say will “flatten” the country’s agriculture industry.

According to the Epoch Times, the message calls on concerned farmers and citizens to organize their own regional actions with the goal of closing all “distribution centers for food supplies and all major polluters” until “the government changes its plans.”

One viral call for a July 4 protest came from a large truckers’ Telegram group, suggesting that some truckers in the Netherlands may find themselves in solidarity with the nation’s agriculturalists.

The farmers, who plan to protest at many of the nation’s airports, specifically mentioned Schiphol and Eindhoven. NLTimes.nl has reported that spokespersons for both airports say they are monitoring the situation but have little information at present.

In 2021, the Netherlands’ coalition government proposed slashing livestock numbers in the country by 30 percent to meet nitrogen emissions targets.

The country has already implemented stringent restrictions on new construction with the aim of curbing nitrogen emissions.

Rabobank has argued that those new hurdles have slowed down homebuilding in the Netherlands, intensifying a housing shortage in the densely populated coastal nation.

…click on the above link to read the rest of the article…

Germany Fears Russia Could Shut Nord Stream 1 Within Weeks

June 25, 2022

Germany Fears Russia Could Shut Nord Stream 1 Within Weeks

The European Union has this week accused Russia of planning “rogue moves” regarding lowering natural gas flows to Europe, or in other words continuing to ‘weaponize’ its energy, to which the Kremlin has consistently responded with variations of ‘our gas, our rules’.

This after Moscow has reduced Nord Stream 1 gas flows by 40% last week while citing technical issues, leading to a four- to sixfold rise in market prices, based on German energy officials. However, Berlin isn’t buying that needed maintenance on the key pipeline is all that’s happening here, instead seeing in it an underhanded Russian ploy to ramp up the pressure on Europe, giving way to fears that the saga could end in Russia halting its pipeline altogether.

“Gas is now a scarce commodity in Germany,” economy minister Robert Habeck said at a Thursday press conference while warning that his country is now approaching crisis supply levels which could see authorities turn to gas rationing.

Habeck confirmed that the last days have seen a “significant deterioration of the gas supply situation” – following Gazprom’s Nord Stream 1 also having to now undergo what the Russian energy company has scheduled as “annual maintenance” for a period of ten days, from July 11 to July 21.

Habeck was asked in an interview this week with German broadcaster ZDF about the negative scenario possibility of Russia artificially extending the repair and maintenance period: “I’d be lying if I said I’m ruling it out. In fact, Putin has gradually reduced the amount of gas more and more,” he responded.

According to the German language publication, the economy minister bluntly spelled out that Putin is trying to use energy to drive a wedge among European allies:

…click on the above link to read the rest of the article…

Germany Elevates Risk Level In Its “National Gas Emergency Plan” To Second-Highest “Alarm” Phase

June 23, 2022

Germany Elevates Risk Level In Its “National Gas Emergency Plan” To Second-Highest “Alarm” Phase

European natural gas and power prices surged after Germany triggered the “alarm stage” of its NatGas-emergency plan amid reductions in supplies from Russia, according to Reuters.

German Economy Minister Robert Habeck said Europe’s largest economy is in a severe energy crisis. He warned Germany should prepare for further cuts in Russian NatGas flows after Moscow recently slashed deliveries via the Nord Stream pipeline.

“We must not fool ourselves: The cut in gas supplies is an economic attack on us by Putin,” Habeck said.

“It is obviously Putin’s strategy to create insecurity, drive up prices and divide us as a society. This is what we are fighting against,” he continued.

Habeck wasn’t clear if NatGas rationing would be avoided.

The second “alarm stage” of a three-stage emergency plan allows utility companies to pass on higher power prices to industry and households to curb demand. The move comes as the Nord Stream pipeline to Germany operates at 40% of capacity after flows last week were reduced for a “technical problem” by Russian gas exporter Gazprom PJSC.

The second stage also increases energy market monitoring and allows for some coal-fired plants to be reactivated to increase electricity output.

All of this comes as Germany is making a mad dash to fill up its NatGas storage facilities ahead of winter. Total storage stands around 58% full, though the government-mandated target of 90% by November, a mark that might be hard to reach considering Nord Stream flows have been reduced.

Front-month benchmark futures rose as much as 6.5% to 135 euros a megawatt-hour on Germany’s elevated gas alarm.

German power for next year also surged 4.5% to 256 euros a megawatt-hour.

…click on the above link to read the rest of the article…

Germany Rations Gas Amid Russian Cuts, Mandates Return To Coal For Electricity Production

June 20, 2022

Germany Rations Gas Amid Russian Cuts, Mandates Return To Coal For Electricity Production

German Vice Chancellor and Economy Minister Robert Habeck said Sunday that the country will limit the use of natural gas for electricity production amid concerns about possible shortages caused by a cut in supplies from Russia.

As a member of the environmentalist Green Party, Habeck pushed through legislation in April to raise Germany’s energy target to 80% renewables. He is also an opponent of nuclear energy.

Habeck said that Germany will try to compensate for the move by increasing the burning of coal, a more polluting fossil fuel.

“That’s bitter, but it’s simply necessary in this situation to lower gas usage,”

The decision comes just days after Russian gas company Gazprom announced that it was sharply reducing supplies through the Nord Stream 1 pipeline for technical reasons, but which Habeck said appeared to be politically motivated.

“It’s obvious that (Russian President Vladimir) Putin’s strategy is to unsettle us by driving up the price and dividing us,” Habeck said.

“We won’t let that happen.”

Habeck’s Press Release on Reducing Natural Gas Consumption.

Gas Reduction in Electricity Sector

“The situation on the gas market has deteriorated in recent days. The missing quantities can still be replaced, and the gas storage tanks are still being filled, albeit at high prices. Security of supply is currently guaranteed. But the situation is serious. We are therefore further strengthening precautions and taking additional measures to reduce gas consumption. This means that gas consumption must continue to fall, so more gas must be stored in storage, otherwise things will get really tight in winter. We will now take the next steps…

…click on the above link to read the rest of the article…

Winter is coming: German agency head warns of gas shortages, bankruptcies, and massive price hikes that will send ‘shockwaves throughout the country’

June 17, 2022

Winter is coming: German agency head warns of gas shortages, bankruptcies, and massive price hikes that will send ‘shockwaves throughout the country’

Inflation is already taking its toll on the German economy, but next winter is now being described in near apocalyptic terms by one prominent German agency head

A gas shortage and high prices will send “shockwaves through the country,” leading to landlords cutting the heat for tenants and widespread company bankruptcies, warned Klaus Müller, the head of Germany’s Federal Network Agency, which is the regulatory office for electricity, gas, telecommunications, postal services, and railway markets.

Müller paints a bleak picture about the crisis in an interview with German newspaper Rheinische Post, saying it will “send shockwaves throughout the country. Banks will ramp up their business with installment loans, and ailing companies will fall into insolvency.”

Müller’s office, which is a federal agency within the Federal Ministry for Economic Affairs and Climate Action, has a bird’s eye view of the economic situation in Germany and also special insight into how economic conditions will develop into the future.

As Germany prepares for crisis, one German energy expert is warning of a situation “where markets simply stop functioning”

Müller says he expects gas prices to continue to climb, resulting in increased inflation that goes far beyond energy. He also warns that there will be a dramatic lack of gas in the winter, which could lead to landlords turning down the heat to save on energy. In turn, Germans may have to grapple with colder apartments.

In a sign that the German government is operating under the assumption that a potential crisis could develop in winter, there are already talks about potentially lowering heating requirement for landlords.

…click on the above link to read the rest of the article…

Potential Dockworker Strike Could Unleash “Super Meltdown” At German Port Of Hamburg

June 4, 2022

Potential Dockworker Strike Could Unleash “Super Meltdown” At German Port Of Hamburg

Dozens of container ships are piling up outside Germany’s largest seaport by volume, known as the Port of Hamburg. It’s the third busiest port in Europe and the 15th largest globally and could be plunged into chaos next week as dockworkers may strike.

German newspaper Die Welt reports congestion at Hamburg is worsening, and container ships have to wait two weeks before entering the port.

“The waiting times are unsatisfactory,” a spokesman for shipping company Hapag-Lloyd said, referring to Hamburg.

Hamburger Hafen und Logistik AG (HHLA), a top European port and transport logistics company, said the reason for increasing congestion is a slowdown in the processing of containers, especially imports from the Far East not being transported fast enough by truck and train.

Besides congestion, Kiel Institute for Economic Research estimates that around 2% of the global container load is stuck at the port. There are also mounting concerns dockworkers could be ready to strike.

“There could be additional problems from next Tuesday. Many reckon that dockers could then go on strike in order to increase the pressure on the ongoing wage negotiations. The next round of negotiations is scheduled for June 10, but the peace obligation has already expired,” Die Welt said.

According to the Verdi services union, the strike could begin next Tuesday. The last time strikes hit Hamburg was in the late 1970s, a period when the world suffered from disastrous stagflation, similar to the economic climate today.

A shipowner told the German newspaper Hamburger Abendblatt: “If it comes to that, we’ll have a super meltdown in Hamburg.”

The timing of the proposed strike by dockworkers comes as consumer prices in Europe’s largest economy surged 8.7% YoY last month (the highest since the start of the monthly statistics in 1963).

…click on the above link to read the rest of the article…

Cutting Off Russian Gas Would Be “Catastrophic”, German Industry President Warns

May 17, 2022

Cutting Off Russian Gas Would Be “Catastrophic”, German Industry President Warns

As we detailed yesterday, almost two months after Europe rushed to declare it would impose unprecedented sanctions on Russia in response to Putin’s invasion of Ukraine with no regard for how such sanctions would boomerang and cripple its own economies, the old continent which was and still remains hostage to Russian energy exports, is finally grasping the underlying math which was all too clear to Vladimir Putin long ago.

The European Union’s executive arm said yesterday that the currency bloc’s economy would expand about 0.2% this year, with inflation topping 9%, as governments struggled to replace the imports.

This severe stagflationary scenario is highlighted by Siegfried Russwurm, president of the Germany’s biggest industry association BDI, warning that the cessation of Russian gas deliveries would have a dire effect on the German economy.

“The consequences of cutting off Russian gas supplies would be catastrophic,” he told tabloid Bild am Sonntag in an interview published at the weekend.

Russwurm added that cutting off Russian gas would deprive businesses of fuel in Germany, forcing businesses to close production lines.

“In this situation many companies will be completely cut off gas supplies. In many cases, affected businesses will be forced to stop production, some businesses may never be able to start again,” he warned.

Europe’s “sudden realization” of just how destructive pushing through with full-blown sanctions will be, somewhat similar to that of Elon Musk who “learned” about the millions in Twitter spam accounts only after bidding $44 billion – is why over the weekend, Bloomberg reported that the European Union is set to fully water down its so-called sanctions and to offer gas importers a solution to avoid a breach of sanctions when buying fuel from Russia while satisfying President Vladimir Putin’s demands over payment in rubles.

…click on the above link to read the rest of the article…

Megalopolis x Russia: Total War

May 8, 2022

Megalopolis x Russia: Total War

After careful evaluation, the Kremlin is rearranging the geopolitical chessboard to end the unipolar hegemony of the “indispensable nation”.

But it’s our fate / To have no place to rest, / As suffering mortals / Blindly fall and vanish / From one hour / To the next, / Like water falling / From cliff to cliff, downward / For years to uncertainty.

Holderlin, Hyperion’s Fate Song

Operation Z is the first salvo of a titanic struggle: three decades after the fall of the USSR, and 77 years after the end of WWII, after careful evaluation, the Kremlin is rearranging the geopolitical chessboard to end the unipolar hegemony of the “indispensable nation”. No wonder the Empire of Lies has gone completely berserk, obsessed in completely expelling Russia from the West-centric system.

The U.S. and its NATO puppies cannot possibly come to grips with their perplexity when faced with a staggering loss: no more entitlement allowing exclusive geopolitical use of force to perpetuate “our values”. No more Full Spectrum Dominance.

The micro-picture is also clear. The U.S. Deep State is milking to Kingdom Come its planned Ukraine gambit to cloak a strategic attack on Russia. The “secret” was to force Moscow into an intra-Slav war in Ukraine to break Nord Stream 2 – and thus German reliance on Russian natural resources. That ends – at least for the foreseeable future – the prospect of a Bismarckian Russo-German connection that would ultimately cause the U.S. to lose control of the Eurasian landmass from the English Channel to the Pacific to an emerging China-Russia-Germany pact.

The American strategic gambit, so far, has worked wonders. But the battle is far from over. Psycho neo-con/neoliberalcon silos inside the Deep State consider Russia such a serious threat to the “rules-based international order” that they are ready to risk if not incur a “limited” nuclear war out of their gambit…

…click on the above link to read the rest of the article…

EU Pushes To Break “Energy Taboo” With Proposed Ban On Russian Coal Imports

April 5, 2022

EU Pushes To Break “Energy Taboo” With Proposed Ban On Russian Coal Imports

Update (0825ET): As EU ambassadors meet on Tuesday to discuss another proposal on Russian sanctions, German Foreign Minister Annalena Baerbock insisted that the EU would “completely end” its fossil fuel dependence on Russia, starting with coal.

Of course, as we noted below, Germany is among the most dependent EU economies on Russian energy. Weaning its economy off Russian energy without triggering a major domestic crisis and “total collapse.”

US equity futures tumbled on the news as investors braced for more international fallout from increasing tensions between Europe and the Russians, which could lead to even higher energy prices.

* * *

Not to be outdone by tiny Lithuania (which claims to have officially weaned itself off Russian gas imports by building an LNG terminal), the European Commission has devised a controversial proposal to ban imports of Russian coal, along with a host of other measures comprising a new sanctions package to be introduced on Tuesday, according to reports from WSJ, Reuters and a host of other media outlets.

Along with banning imports of Russian coal, the package also calls for an import ban on rubber, chemicals and other products from Russia worth up to €9 billion a year.

If passed, the proposal would mark the first energy sanctions on Russia since the start of the conflict in Ukraine. Although it wouldn’t touch oil and gas, such a ban would break the so-called “energy taboo”, according to Bloomberg’s Javier Blas.

While thermal coal isn’t nearly as critical as oil and gas, it’s still a “big deal,” Blas pointed out.

Coal-fired power plants are still being used across the EU, though most member states expect to completely phase them out by 2030. Russia has the second-largest coal reserves in the world. In 2020, it mined 328 million metric tons, making it the sixth-largest producer globally…

…click on the above link to read the rest of the article…

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