Playing Games
This is the third story on the Nord Stream Pipeline in just one week, which is all you need to know about this back-and-forth affair. Last time, we discussed how Europe’s energy from Russia is very unreliable, and that the bloc of 19 nations were at the edge of a cliff with Russia ready to push them down. The pipeline was back and running, but anything could happen as shown before.
Europe’s worst fears were confirmed. Russia decreased Europe’s gas flow to 20 percent capacity, down from the standard 40 percent it was running at pre-maintenance. Gazprom, the Russian state-sponsored oil company that controls the pipeline, cited a turbine problem, sending energy prices in Europe up almost 7 percent. Energy prices in the continent have doubled from a year ago, and this triggers a Doomsday scenario that will end in more than a recession. With flows so low, Europe will not be able to store enough energy for the winter, which will force mass rationing of power across the continent. Germany’s energy regulator previously warned that even with flows at 40 percent, the country would struggle to stock up for the winter, and this was just the nail in the coffin. Germany, the king of the European Union economy, has placed multiple restrictions to prepare. This includes things like banning gas heating in swimming pools and offering incentives for companies to reduce their gas consumption. This will slightly mitigate the effects, but it won’t stop the force of Russia’s hand from pushing Europe into economic demise, which comes at a terrible time as the US might plunge into a recession too.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
