German government implements ‘alarm level’ of gas emergency plan

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Germany triggered the “alarm stage” of its emergency gas plan on Thursday in response to falling Russian supplies but stopped short of allowing utilities to pass on soaring energy costs to customers in Europe’s largest economy.

The measure is the latest escalation in a standoff between Europe and Moscow since the Russian invasion of Ukraine that has exposed the bloc’s dependence on Russian gas supplies and sparked a frantic search for alternative energy sources.

The decision, announced by the economy minister, marks a stark shift especially for Germany, which has cultivated strong energy ties with Moscow stretching back to the Cold War.

Lower gas flows sparked warnings this week that Germany could fall into recession if Russia supplies halted altogether. S&P Global’s flash Purchasing Managers’ Index (PMI) on Thursday showed the economy losing momentum in the second quarter. “We must not fool ourselves: The cut in gas supplies is an economic attack on us by (Russian President Vladimir) Putin,” Economy Minister Robert Habeck said in a statement, adding Germans would have to reduce consumption. “It is obviously Putin’s strategy to create insecurity, drive up prices and divide us as a society,” he added. “This is what we are fighting against.”

Gas rationing would hopefully be avoided but cannot be ruled out, Habeck said.

via Reuters

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