Vladimir Putin Drives Down Europe Gas Prices By Ordering Company to Supply Austria, Germany

European gas prices plummeted Thursday after Russian President Vladimir Putin called on the country's major natural gas company to supply more gas to storage facilities in Austria and Germany, the Associated Press reported.

Prices fell immediately after Putin directed Alexei Miller, the head of the state-controlled gas giant company, Gazprom, to start putting gas into the company's storage facilities in Germany and Austria after it fills the domestic facilities by November 8.

"This will make it possible to fulfill our contractual commitments in a reliable, stable and consistent manner and to supply our European partners with gas in the autumn and winter," Putin said. "This will create a favorable situation, at any rate, a better situation in the European energy market in general."

The price drop comes after Europe's gas prices greatly increased in recent weeks. Demand had been growing strong in Asia, driven by the economic recovery from the COVID-19 pandemic, and due to depleted European Union stocks.

The 27-member European Union relies on Russia for more than 40 percent of gas imports.

For more reporting from the Associated Press, see below.

Russian President Vladimir Putin
European gas prices plummeted Thursday after Russian President Vladimir Putin called on his country’s major natural gas company to supply more gas to storage facilities in Austria and Germany. Above, Putin chairs a meeting on development of the resource potential on the Yamal peninsula at the Novo-Ogaryovo residence outside Moscow on October 27, 2021. Evgeny Paulin, Sputnik, Kremlin Pool Photo/Associated Press

While Gazprom has met its obligations under long-term agreements, it has not sold additional gas on the EU spot market, opting to fill domestic storages. Some European politicians alleged that Russia was withholding gas deliberately to pressure German and EU authorities into speeding final regulatory approval for the recently completed Nord Stream 2 pipeline.

Putin noted last week one of the two links of the new pipeline under the Baltic Sea already has been filled with gas as part of preparations for its launch, adding that supplies could start "the day after" after regulators give their approval.

Nord Stream 2, with an annual capacity of 55 billion cubic meters of gas, is designed to deliver gas directly to Germany, bypassing Poland and Ukraine, which have vehemently opposed the project along with the U.S.

Ukrainian authorities fear the pipeline will deprive the country of $2 billion in annual gas transit fees and erode its international standing amid a tug-of-war with Russia following its 2014 annexation of Ukraine's Crimean Peninsula and support for separatists insurgents in eastern Ukraine.