German Economy Minister: "Gas Is Now a Scarce Resource... Must Prepare for Further Price Increases"

Robert Habeck, Germany's Minister of Economy, is explaining the gas supply crisis at a press conference on the 23rd (local time).
Photo by AP Yonhap News

[Asia Economy Reporter Park Byung-hee] "We are now facing a gas crisis. From now on, gas is a scarce resource."

Robert Habeck, Germany's Minister for Economic Affairs, made this statement at a press conference on the 23rd (local time), according to major foreign media reports. On the same day, the German government raised the gas emergency alert level to stage 2 out of 3. This came just nine days after the Russian state-owned gas company Gazprom cut gas supplies through the Nord Stream pipeline connecting Germany and Russia by 60%. Earlier, on the 19th, Habeck also announced an emergency measure to temporarily restart coal-fired power plants that had been shut down.

Minister Habeck appealed to reduce gas consumption, saying, "Although prices have already risen significantly, the public must prepare for a situation where gas prices rise further." He added, "The increase in gas prices will cause production disruptions and increase the burden on consumers."

Habeck also stated, "The gas crisis is targeted at Germany and is a shock originating from outside."

The stage 2 gas alert issued by the German government on this day means that authorities have judged the gas supply situation to have seriously deteriorated. However, it also reflects the assessment that the market can withstand the situation without non-market interventions.

Minister Habeck warned, however, that the highest level, stage 3 emergency measures, cannot be ruled out. Stage 3 means that measures targeting companies and consumers for gas supply rationalization may be implemented.

Chancellor Habeck said, "Rationalization should not occur, but it cannot be excluded."

Last week, the Russian state-owned gas company Gazprom reduced gas supplies through the Nord Stream pipeline connecting Germany and Russia by 60%. Since then, Germany has been under a gas emergency.

The reason Germany is taking the current situation seriously is that the annual maintenance period for the Nord Stream pipeline is approaching. Locally, there are concerns that Gazprom might completely stop gas supplies citing the annual maintenance period and may not guarantee resumption afterward.

According to German gas industry officials, during the Nord Stream maintenance period, Germany usually supplements gas from Ukraine. However, this year, with Ukraine at war and the already significantly reduced gas supply through Nord Stream, there are concerns that considerable damage could occur.

So far, the reduction in Nord Stream gas supplies has not caused substantial damage to Germany, as gas consumption typically decreases to 20-25% of winter levels during summer.

However, as the first half of the year ends and preparations are made for the sharp increase in gas demand during winter, stockpiles need to be increased.

Currently, Germany's gas storage facilities are about 59% full. This is a higher level compared to the same time last year. However, Minister Habeck said that due to the low gas supply, if additional measures are not taken, the government will not achieve its goal of securing 90% stockpiles by December.

This content was produced with the assistance of AI translation services.