A surge in the cost of gas which has seen bills shoot up for households and industry is down to a shortfall in electricity generation, and not because Russia is somehow squeezing supplies, President Vladimir Putin has argued.
Speaking as part of a keynote address at Russian Energy Week on Wednesday, Putin said that a fall in output from wind farms had meant electricity prices shot up, having a knock-on effect on demand for gas. Wind power makes up an increasingly large share of Europe’s energy generation, particularly in the west of the continent, he went on.
“The rise in gas prices in Europe was the result of a shortage of electricity, and not vice versa,” the president insisted.
Putin went on to accuse Western leaders of “trying to cover up their own mistakes,” following a series of claims that the situation is because Russia is withholding supplies. He added that “proper analysis of the situation is often replaced by empty political slogans.”
According to the Russian president, an exceptionally long winter drained the continent’s energy reserves and disrupted pricing. Now, “the invisible hand of the market” is at play, Putin said.
Contrary to Russia seeking to worsen the crisis, Putin insisted that the country could well see record levels of exports in 2021 as Moscow works to meet the growing demand. That said, though, he claimed that the Kremlin doesn’t relish the prospect of shortages and that “the high price environment can have negative consequences for everyone, including producers.”
Some countries have seen gas prices rise by as much as 250% in recent days, with a knock-on effect being felt in the industry. Homeowners also face higher heating bills with winter fast approaching. Several energy companies in the UK, which has seen some of the sharpest increases, have entered into talks with the government to prevent them from potentially going bust.
Last month, Putin’s spokesman, Dmitry Peskov, said that the state energy firm, Gazprom, is already fulfilling all of its contracts and no customers have been denied deliveries. According to him, “nobody has any grounds to claim otherwise,” and the company is making preparations to strike new deals and increase the volumes flowing westwards.