According to persons knowledgeable with the situation, Gazprom PJSC plans to restart gas deliveries to Europe via its Nord Stream pipeline on Thursday at a reduced capacity.

Shipments will restart when maintenance is completed on Thursday, but will be lower than typical because the Russian gas giant imposed force majeure on several European clients, according to the people, who did not want to be identified because the information is private. Flows through Russia’s main route to Europe were previously limited to 40% of capacity.

The Kremlin will still have to make a final judgment. Surging gas prices have helped Gazprom to meet its full-year target for export profits from important markets in just five months, according to one of the sources.

Europe, which is reliant on Russian gas, is waiting to see if flows will restart on Thursday, when maintenance is scheduled to end. A comprehensive shutdown would be disastrous for European industry, raising the possibility of shortages and shutdowns this winter. The gas war is even threatening the euro, and the European Commission is scrambling to find ways for the EU to reduce its usage.

While the Kremlin has given no hint that flows will not restart this week, a July 14 decision to declare force majeure on supplies to certain European consumers fanned concern that the gas will not return.

Nonetheless, a squabble over a pipeline section embroiled in Canadian sanctions appears to be on the mend thanks to German Economy Minister Robert Habeck’s diplomatic efforts. In another potentially encouraging indication, the operator said on Tuesday that some modest gas volumes were transferred through the pipeline for “technically required pressure equalization.” Nord Stream stated on Tuesday that it is keeping to its original schedule.

Europe is bracing for disaster: On Tuesday, EU Budget Commissioner Johannes Hahn stated that the EU is working under the assumption that flows will not resume. The German government, for its part, has stated that it will wait until Monday to determine whether or not flows will continue. This is to allow extra time for the pipeline section to return to Russia from Canada.

Source: Bloomberg

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