has done out of surface deeper using the mass, so there's no face further displacement with detailed coverage. you've read off your vision forces forced hundreds of civil news through this. please prompt this call surface and bit handle on from the house of the story is wait a minute to reset the it was target thing. come on those and start the hospital has provided no evidence who was so success. ukraine shuts up for us and gas. the europe through it's tara treat off the a pre will deal expire yet. russian gas applies to the ship. russell, 11th western fuel sciences, imposed over the triangle cuts in europe and russia. this is inside story, the

hello and welcome to the program. and we're on con, the ukraine will, has led to the west imposing some of its harshest sanctions on russia. pipelines supplies have been drastically cut yet. russian liquid natural gas is being shipped into your at record levels. while the will continue use your most important economy . gemini, has split into recession, so have fuel sanctions against russia, worked out as planned, or all day hurts in europe. mold and russia will talk to august shortly. but 1st, this report from victoria gave me of russia and the say the union spend half a century becoming a major supplier of gas to europe. but the war in ukraine has oh, but destroyed that business for the state energy giant gas problem. and now, russia's oldest gas supply line to the european union through ukraine. his shots after a 5 year deal between moscow and keith expired. looks to the what's the point is uh,

we will always in favor of gas appliance of the supplies being above politics of the and being purely economic methods. we never said nothing to supplies to your ukraine, nearly a $1000000000.00 in transit fees last you bought, it says, payments for the gas of helped russia to wages will run the country. russia is expected to lose $5000000000.00 annually. european country most affected by the end of the transit deal is mold a is a, it's not part of the european union. it's being forced to impose a 60 day stage of emergency and its energy sector before rusher invaded ukraine in 2022. it was the biggest supplier of gas to the blog, providing more than 40 percent in 2021. bought since reducing its dependency after that invasion. the you impose it about 8 percent in 2023. we are alternatives, but they are attempt to be a bit more expensive than the russian pipeline. guess the impact will be solid,

especially in australia and hungry in slovakia, where the price of gas will likely rise. and this could have an impact on the consumer prices on the costs of living, but also on, on prices for industry. the most rushing gas roots to your up a shot, including the node stream to pipeline, onto the voltage that was blowing up in 2022 spots to shut down the pipeline through. ukraine will not stop rushing gas from entering europe. the tux stream pipeline is still operational, supplying gas, suppose to, to a kid, then to hungry and sub you choose to import the russian liquefied natural gas to the you reach record highs last year, raising questions about the effectiveness of the sanctions on russia. the design to limit funding for its war in ukraine. victoria gave some b. l. g 0 for inside story.

that's bringing out guess been iris is found an editor in chief of business news europe. he joins us from berlin. natasha fielding is editor, august media, an energy and commodity price agency. she joins us from london and alex tito is electra at queen's university both fast and a specialist in russian foreign policy. he joins us from of intends in italy. a woman welcome to you. oh, i want to start with alex 1st. so we have this new reality where there's no russian gas coming in via ukraine. but is it as simple to say the russia has somehow beaten europe sanctions as well depending of what you want to see. they can have effective look sanctions where originally intended to be, if it were intended to be, to fill out the structure of the economy and to make it a financing a little more impossible. they obviously have filed russia has continued to

accumulate. uh for, for an um, for the reserves sides, it still gets a lot of money from sending an edge it to the world markets. if you think about your dependency relation dependence on russian gas, which i think a see, it says open coffee, steam that is pretty huge. exaggerated in europe has not post on function with all the russian gusts of, um, uh, included, russia has stopped functioning without sitting is goes to europe. so i saw the i, the sides have been blow so robust to rush cuz lots of ready to use from gas. but i have to say that's i'm most of for us and revenues from southern energy costs from oil a new way. so we were as gospel rushing, my statement, opening of god for gas has been huge, very hot in terms of losing its most lucrative market to um, to sanctions, uh, uh, the roster itself has been able to find ons. um, you know, it's more and it's um, um economy because it says have to get supplies to europe which including building

up um your supplies to places like into which kind of a sold before. uh, forgot. it's much more difficult for russia, but uh so its not so easy for you to buy that. so the both being affected. uh, natasha. um, one of the things that's interesting about all of this is there seems to be certainly for russia and for european countries, the want cheaper gas will try and get more gas. is that all the low loopholes in the sanctions that have been exploited? i mean, the sanctions are pretty useless all by to them. so interestingly, that all know any direct sanctions preventing russian pipeline gas or russian liquefied natural gas from entering europe. we saw a domestic reduction in europe, russian pipeline gas in ports in 2022. that was not down to

a direct sanctions and we are still seeing a strong deliveries of liquefied natural gas into, into europe, from russian terminals. so in, in that sense, and also the, this ad mentors day for, for the european gas market where ukrainian transit halted. but that was really not down to sanctions, but rather to the expiry of the russia ukraine transit deal and to ukraine's unwillingness to sign a new deal for that transit to continue. but it's a very interesting with natasha is just used as my mentor is. and the mentors day because ukraine has said enough is enough. this a business deal, no sanctions deal. we can get rid of this deal if we want to. and actually it's hurting us cuz but billing those billions are being used to kill our people,

say business as trying stover sanctions political sanctions. is that right? you can put it that way. i'm having the business, i guess. um, but i as, as i said, i mean, you should be clear that there's no sanctions on importing by some gas. and this is a pragmatic thing. but in many countries have chosen to try and wing themselves of russian gas gemini, being the biggest example in so much as it was entirely dependent on inputs of gas via pipelines and the, the north stream to pipelines were blown up in september. and those were the main pipelines that were landing in germany. um, but one of the strands is still intact and could deliver gas. but germany is taking the principle of the system not to use that will restart that despite the fact goods and offered shots to turn them back on again. and it switched to n and g, a great expense because it had no energy terminals. um, but as you know, hired these floating terminals, but the whole business uh,

the account economics surrounding the gas. i'm, it, it's cause you're a huge problem because energy prices here, and you're now double what they were despite those huge spiking prices in 2022. and the price is coming down, but the prices remain double what the long term average pretty well was. and so you crane, i mean, that was so like in a cut that knows of a certain extent because they were making a $1000000000.00 a year in transit fees, which ironically, or with a gas problem was continuing to pay t of throughout the last 3 years. of pool and on the other hand, the ukrainians are arguing that the gas problem was ending $6500000000.00 a year from exports in gas to europe. and that money was going straight back to fund the war machine. and so the ukraine trainings we put in the really bizarre position whereby they were facilitating a business that gas problem was doing that was raising money for the coming that was then being pulled into the war against ukraine. and so i think this is the

logic behind some excused decision to forgo the opinions of those which they desperately need and you kind is incredibly short of cash. nevertheless, his argument is. ringback that we will cost materials from this $6500000000.00 in order to make it more difficult for them to fund the war. and because russia is struggling to fund, the boy is running a budget deficits. economies of the heating it needs every penny and, and now it's being cut off from a business has been running for 50 years. 17. in the seventy's, the street was hooked up to the pipeline. the 1st gas arrived in europe and throughout the cold war. this gas and this business continued to flow despite the geopolitical tensions, zipcode for your continued supply, gas and 70 percent, versus expo guess se um is pipelines run to the front of your front of west, and that's now stops. and that's the middle part of the pipelines and the staff,

and brush a, you know, it has looking to, to transport this gas east. but there's no pipelines and those things are incredibly expensive to build and they take at least a decade to construct. so this is a really big historic moment where russians infrastructure energy infrastructure is not useless, is just sitting there and copy use and gas pro has been cut off from, from the billions and billions of dollars that they use to and from exports into your a. tasha spanish just said that the, the russian infrastructure is useless. it is useless right now, but the infrastructure isn't going to go away. is there a chance that russia can save the day somehow by doing a strictly business deal with other countries? i am so it's, it's correct to say that us now that, that russian gas is no longer flowing to through ukraine and into other european

countries. the gas cannot simply be redirected elsewhere. it cannot be redirected into, for example, l n g export facilities. and given that ukraine is a key transit market for the rushing gas to and to europe without a, a deal and an interconnection agreement between russia and ukraine. it is impossible to uh, to, to have for that rushing gas to enter your through train. uh so um, at the moment, uh, in terms of the other available routes, the now the only route for rushing pipeline gas to get to your is through the texas stream pipeline. now there is a little bit of scope for those flows to increase this year. the pipeline did run on the capacity,

but that would no and then make up for the loss of ukrainian transport. and and of course, at china is another big sales market for, for russia. but it will take a while to build additional infrastructure to ramp up those exports to china much further. other seats of the, of the market size natasha is pointed out for russian energy supplies. whether it is you know, whether is a gas. however, january 20th is coming and is coming very quickly, trump will be impala in the us. let him, if he gets in is probably glad of that thinking, but he might well get a deal that's in his favor when it comes to ukraine. is there a way that you see that the americans will somehow force ukraine to accept a deal that brings back that ukrainian transit points back in?

is that going to be part of trumps thinking? do you think i, you know, i don't think so because 1st of all, for united states themselves they, they need to take it off from interest. and i was just surprised as to to europe, where i've been trying to replace a russian gas pipeline with allergy and it's been always economically more bible to buy gas off for russian. you know, in europe i, it was a because we're doing good out of charity. it was just because russian gas was competitive compared to other alternatives for decades previous to there's absolutely no reason for trump to want to have these a gas to come back. but also, i think, you know, there is a class data type for related in to do that extend implemented, you repeating you, commission policy of we in europe of russia's ross was golf for auto signage and on any trade was, were actually did. and it's very difficult to see why trump would want to force it

on your vehicle. don't want it, force it on your gradients, go don't wanted and russia itself. and i, even though it was, you know, we built in uh, gall supply, but they really don't want to, you know, what could i do or says such a scenario straight. we do find why you create high that means wanted to restore if, if it was the results of savings to you, they would want to just um, remaining, uh, minutes due to pipeline, which hasn't been blowing out yet. um and uh, the guests prospects don't, don't look good so far for the, for us what they, you know, they're not in terms of the ad on june, which i think they just finishing a new facility on the multics which can use some of the gas from the adjustment to know stream uh they do their off by price to china. the only problem is that the new pipeline which would come from the, the gym all opinions july. his chinese, the, i think very hard negotiations on the doesn't seem to be going anywhere anytime soon

. but broadly speaking, i so they will survive it. you know, it's not, belittle, could you have a rising price as a domestic life for, for gas prompted, compensated somehow for the last 7 years from europe. but um, the gas pipeline would have to be in this, i think, i think very few backup protection with won't come ukrainian. um, augusta back and the home it goes on. i mean the, there might be no be anything left. so if you're creating a guess, i guess, but, but anyway, but not just because rush of my boat, but it's which it might, but also because, you know, it's very expensive to maintain it without transit fees, without guessing going through it without money getting, getting from it so i don't see where you credit, so have the capacity higher potential technical to actually to preserve the gas pipeline anyway in the long term. well, let's get into the politics of this now up. and one of the key things here is jim,

and he is one of the key is the biggest economy in europe. it's, it's suffering because of the principles found that they took against getting russian. they really led the way when it was russian sanctions and not getting russian products into european markets. but the thing now is to the point where is having an impact on domestic politics. right? yeah, i'm germany's in a, in a horrible position like i say, pretty well it was in the exports or power, but then the top of why me, they suffered a, having the cheap russian gas turned off. and germany was another for the rest of europe because the most stream to pipeline lined in germany and then it was distributed. so jim, he also has the biggest european e u storage tanks. and so is supplied a lot of countries around it. it's really in particular, and that stops at the same time, that's enough to make it a pass stations. and so suddenly there's been an energy deficit. and that's cost in

the economy. that the price is a gas in germany. i said before that they're already twice as high as pretty well, but in germany the twice as high again as the rest of your and the industrial over here, i can tell you that pushing very high time the gas back on through this. but the surviving strand of the node strain, which would be 25000000000 cubic meters gear. and for that it's concepts. you're used to in court, a total of a $150.00. but um, the, the, the economics, i mean, generally, is going to the recession and it's being the industrialized that you've got a whole class of heavy factories, pets, chemical ponds, refineries, power that are no longer economically vi. and that problem can be fixed. i mean that there's no short term solution to that. and so the 3rd attempt, germany's companies have already left the country because it just simply doesn't work anymore. the is too expensive to operate and another set of talking about

leaving. and so domestically um, germany's already suffering from a competitive problem and now is energy costs twice that of the rest of europe, which is twice that of what that is in the states and germany and u. e. u as a whole is slipping behind and that's a problem for everybody because as you know, the spider, so germany is the, is the economic engine for your benefit, germany's finest as which it is then that bodes well uh ill. so the rest of the year being economy is going forward. uh, natasha. its a horrible word to use, but contagion, coming from you. no rush. uh no. being able to get his gas into europe and then back affecting germany and then jeremy's gonna think smaller european countries. this is going to spread and it is spreading right now throughout your right. oh, absolutely. yeah. there's a, there's a knock on impact. so it is primarily a central needs to european countries that are directly affected by this whole and

you create in transit, austria, so back you check a public, moldova, um, but uh that, uh, that suspension of russian and gas supply through ukraine means that those countries need to replace that gas which supply from elsewhere and gemini, is a f, as is a key, nit next door markets to receive the attentive gas supplies. so that will be uh, more of a pool and gas from west to east, which will in 10 require more withdrawals from german underground storage. and this really poses a challenge, not just for the rest of this winter, but for next summer. when those a storage tanks underground storage is as we'll need to be refilled ahead of the following, went to and, and doing that without that russian gas, the ukraine it, it creates a tight to market. and this is especially in the context of

a tight global gas smoke that europe has primarily replaced rushing gas with liquefied natural gas and which it must compete with asian buyers. and we have see the much more competitive environment for a l n g a. this went to them the last one to uh so right. uh, as we have this kind of combination of, of events like say top, is there an opportunity then for russia, natasha is just said europe could face a crisis. not this coming winter, but yeah. then the next coming winter of the little the gas runs out, is there an opportunity here for russia to either increase applies to other buyers and try and solve your account? is there any kind of opportunity here as well? i mean, the circuits due to, to apply, i took a state but a surprise and you're

a goes off. i mean, they will get more money of from what it was remaining of the guys pipeline, but it's ok plus whole. so of course energy which they still sell to do, euro and a g m a n g by its nature, it's made more like, or uh, good approach. you go to market in the sense that it's gonna be shipped to global a ross. it has kind of beauty facility just to ship more to it, to asia, particularly building out it's exit from a buy another tech from albany. and so the moment it so our facing westphal to my mover must come to you or you were. i think the to say i'm thinking over imposing sanctions of transport from transits um ebony transitional by repeated thoughts to sort of feel that i felt a rush has been developing. it's trained to reform email uh via come child because of the beauty facilities there. and then on to the east asia, which is the traditional business, got a form of a high high mileage. you processed for venue way. so uh,

a rush to will benefit from uh, increasing general uh, items to the market. so for increasing in the, in the process for energy of, for gas. and um, but yeah, i mean it's, it's the gas pipeline is a, is a such a thing that, you know, it takes us to build and the reward tonnage of to it is just china and china has been very helpful that you'll be able to send up all our files to be able to, i mean china now is actually after you create installed, is it possible but then goes to the bottom, then you're right. the 1st time have a as well. so alex, we all running out of time and i want to, i want to bring your points to the other guest as well. but what are the words that we've heard here is winning? we will, you know, europe is trying to win a freshman guess. when we've heard that from the americans, as we are trying to wean off the middle eastern oil, but they never really works. is there a case to be said the in a few years time, maybe even shorter than that. but we're going to back to business as usual when it

comes to russian gas, just because it's convenient and easy. it's already business as usual. and so much as you know, this, this idea of winning or 1st and gosh, i guess is a, is a fiction because europe is, is still dependent on russian gas, not in the same way that it was before when it inputs 35 percent of discussed with russian guys, nevertheless, it can't do without it. and let's estimate a very good point. the, you know, the, the tanks and you of, uh, already emptying at a much faster pace than i did the last 2 years. it's not a catastrophic pace, but you know, the tanks are on cost to be pretty empty by the end of this winter. and then that gas to rebuild, that has to come from some way and with that. but i guess you can't get you to wait and the pickup on that point as well. bring it home and i just wanna get some natasha. and to alex as well. uh natasha. have then the, the sanctions, uh, the business deal of all of this idea of getting gas into europe via russia just

being temporarily posed and it will come back at some point. um, i say this is one of the biggest questions uh on, on european trade. his minds will not rushing guess come back. i think one thing we've learned from the european gas market of the past few years is that it's anything but predictable. what i would say is that europe has now invested heavily in getting alternative supplies. it's really built up, it's l n g in full capacity in order to make do without that rushing gas permanently. so we can see the future. i think uh the what happens with the wall will really help to determine whether russian gas comes back to europe and cope without if i say so just very quickly then have of has the sanctions failed? it has um the wherever, everything that you was trying to do has filed and all right,

so really needs to do is just wait to out. you know, the weight of the weight in the wall. i mean, because at the moment they are waiting on the battlefield and i think that's about it. so, i mean, what, what does the gosh, what happens to guessing all the things that we will have to be a political acceptance and you don't make a change of new policies in europe as well. we've been going to germany possibly for us and decided century 26th and to 7. uh that uh you cons, defeat restaurant can only, can you come to his russia on the battlefield? come fix all the help that you have to do with it. and maybe you can, gas will become part of the kind of lot to deal with russia to, to settle that ukrainian more. but, you know, this is, you know, looking into them, how can you add, if nothing versus a few grand continues to lose on the battlefield. then you know anything can happen, what will be the big deal at the end of this war and nobody knows what i want to thank oh guess, ben harris natasha fielding and alex tito,

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