European leaders are racing to investigate potential acts of sabotage after both the natural gas pipelines linking it to Russia suffered inexplicable and sudden leaks — resulting in unprecedented damage as the bloc scrambles to transition away from Russian fossil fuels.
The leaks squashed ideas Europe could still receive any additional gas via Nord Stream 1, the largest single supply line linking Russia to Europe, before winter. Though neither pipeline was operational at the time, both lines were filled with gas under pressure.
Footage released by the Danish Defense Command showed a swirling mass of methane bubbling up onto the surface of the Baltic Sea. Officials in Denmark raised its security alerts at electricity and gas facilities around the country.
Just a Coincidence?
Timing of the leaks was significant, occurring just hours before a ceremonial launch of the Baltic Pipe, the natural gas pipeline linking Norway to Poland. The opening of the pipeline, which will bring Norwegian supplies through Denmark to Poland, is seen as a major step to mark the EU’s transition away from Russian gas.
Danish Prime Minister Mette Frederiksen said she “cannot rule out” sabotage in the leaks — two of which occurred on the Nord Stream 1 pipeline and the other on Nord Stream 2, which never opened for commercial operation due to Russia’s invasion of Ukraine.
“It is too early to conclude yet, but it is an extraordinary situation,” Frederiksen said. “There are three leaks, and therefore it is difficult to imagine that it could be accidental.”
Polish Prime Minister Mateusz Morawieck, in comments at the opening ceremony for the new Baltic pipeline, said: “Today we faced an act of sabotage, we don’t know all the details of what happened, but we see clearly that it’s an act of sabotage, related to the next step of escalation of the situation in Ukraine.”
Now What?
Ships were instructed to avoid the area, and the Danish Energy Authority declared a state of emergency over the leaks.
Attacks on infrastructure could signify a new phase in Russia and Europe’s battle for energy, said Alex Munton, an expert on global gas markets at Rapidan Energy Group, a consultancy. This is “an escalation in the conflict with potentially direct attacks on physical infrastructure,” he said. “The implications are: what other infrastructure might be vulnerable to something similar happening?”
Market Impact
The incident will not impact natural gas supplies to Europe, as operations at the pipelines were already halted, but benchmark European gas prices rose 12% on Tuesday (Sept. 27) due to market concerns about further sabotage of the remaining flows of Russian gas through Ukraine.
Gas prices remain below the all-time highs seen earlier this year. Still, prices are a staggering 200% higher compared to September 2021. James Huckstepp, the head of EMEA gas analytics at S&P Global Platts, told the Financial Times that the leaks will exacerbate energy market uncertainty:
“The probability of Nord Stream 1 coming back before the end of the year has essentially dropped from 1% to 0%.”
More on energy and the war in Ukraine:
War in Ukraine: Risks and Opportunities for U.S. Farmers
New Information Shows the War in Ukraine Could Have Been Prevented
