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Russia reduces gas transit to Europe via Ukraine

FILE PHOTO: Illustration shows natural gas pipeline and Gazprom logo

MOSCOW/MILAN/WARSAW (Reuters) -Russian energy giant Gazprom will ship 25.1 million cubic metres (mcm) of gas to Europe via Ukraine on Thursday, it said on Thursday, further reducing its supplies to the European Union.

At the same time, data from Ukraine indicates a possible partial recovery in supplies on Friday.

Russian gas exports to Europe via pipelines plummeted to a post-Soviet low in 2022 as deliveries to its largest customer plunged because of the conflict in Ukraine and suspected sabotage that damaged a major pipeline.

Gazprom had already reduced flows to 32.6 mcm via the Sudzha metering point on Tuesday, down almost 8% from the previous several days.

The company had shipped gas via Ukraine at between 35.4 mcm and 35.5 mcm over Jan. 6-16, having exported more than 40 mcm per day for most of the second half of last year and the first three days of 2023.

Ukraine's state gas transit company said that Russian gas nominations, or requests from customers, were seen at 35.2 mcm via the Sudzha metering point on Friday, signalling a possible partial recovery in supplies.

The Kremlin referred questions about the reduction in gas deliveries to Europe via Ukraine in recent days to Gazprom, saying they were a commercial matter.

"This is a question for the company ... we are talking about commercial deliveries, this is corporate information," Kremlin spokesman Dmitry Peskov said in a daily conference call.

LOWER DEMAND

Stefano Venier, Chief Executive of Italian gas grid operator Snam, said gas demand has been lower than usual.

"I don't think there is a special reason behind the reduced gas supply from Russia via Ukraine. I believe it is linked to a fall in demand," he said at a news conference on the group's business plan.

Italian gas demand has recently hovered around 250 mcm per day and until Wednesday had been lower than usual for January, he added.

A gas trader with a Western utility trading on the Ukraine transit route said the current situation is a combination of two factors: lower gas demand and a mild winter on one hand and destruction of buyers' trust on Gazprom being a reliable supplier on the other hand.

Italian energy company Eni on Thursday said that the company was not experiencing any issues with gas supply from Russia.

Gazprom did not respond to a request for additional comment.

(Reporting by Vladimir Soldatkin in Moscow, Marek Strzelecki in Warsaw and Francesca Landini in MilanEditing by Shri Navaratnam and David Goodman)