Russian state-controlled gas monopoly Gazprom has restored the pace of gas transit shipments across Ukraine to Europe after a significant decline in deliveries last week that prompted fresh concerns about potential shortages.
According to a disclosure from Ukraine’s pipeline operator, Operator GTS Ukrainy, transit of Russian gas rose to about 115 million cubic metres per day at the beginning of March.
The operator said last week that Gazprom cut daily gas nominations via Ukraine’s pipeline network to less than 70 MMcmd on 20 February, though the gas giant contracted the minimal transit of 109 MMcmd for February under a five-year contract signed in December 2019.
The reduction in the transit flow — which Gazprom did not explain — has sparked concerns of potential shortage of gas in Central Europe countries, which continue to receive the bulk of their gas via Ukraine and that have experienced unusually cold weather.
However, Gazprom confirmed this week that it is seeing the rebound in demand for its gas in Europe, with its European gas exports growing by 33% to 34.5 billion cubic metres between January and February.
The monopoly added that it saw a strong growth in Russian gas sales in Hungary, Italy, Poland, Germany and Turkey this year.
Besides the traditional route across Ukraine, Gazprom delivers gas to its customers via the Nord Stream and TurkStream subsea pipelines and onshore Yamal Pipeline running across Belarus and Poland to Germany.
The Russian gas giant also said that the robust demand in Europe and China hiked its gas production in Russia, which rose by almost 8% to about 90 Bcm in January and February.
Oil producers pain
However, Russian authorities also revealed a sudden sharp decline in the country’s oil exports in this period, despite earlier concessions from the Opec+ alliance allowing the country it to slightly grow its output.
Russian state energy statistics agency Cdu-Tek said that oil shipments from the country fell by 17% to 35.2 million tonnes (4.37 million barrels per day) in the first two months of this year.
The pace of the decline accelerated in February, according to Cdu-Tek.
Most Russian oil producers have had to deal with increased tax payments from 1 January after authorities scrapped various tax incentives and privileges aimed at facilitating the development of heavily depleted, hard to recover and unconventional oil projects.
Russian regional oil producer Tatneft — which develops legacy assets and heavy viscous oil projects in the region of Tatarstan — said on Tuesday that its production declined by 13% to 4.16 million tonnes (517,000 bpd) in January and February.
Several Russian oil producers, including Lukoil, said that they resumed talks with authorities about restoring incentives for high-cost oil projects following a recent rebound in international energy prices.