Russia restarts natural gas flows to Europe through Nord Stream pipeline, cooling prices and recession fears

• Russia restarted flows of natural gas through the Nord Stream 1 pipeline on Thursday after a routine shutdown.
• European natural gas prices fell, and politicians breathed a sigh of relief as the risk of a catastrophic energy crunch receded.

Russia restarted the flow of natural gas through the Nord Stream 1 pipeline into Europe on Thursday, bringing down gas prices and cooling some concerns about a catastrophic energy crunch this winter.

The Nord Stream 1 pipeline — through which Russia supplies natural gas into Germany and Western Europe — shut down last week for a 10-day maintenance period. With tensions rising over the war in Ukraine, many politicians believed Russia would not restart the flows.

However, a spokesperson for Nord Stream, the consortium in charge of the pipeline, told Insider on Thursday that flows were up and running again.

"Nord Stream AG has successfully completed all planned maintenance works on its twin gas pipelines within the scheduled period. Gas transmission resumed on 21 July 2022," the consortium said in a statement.

Nord Stream data showed flows were picking up on Thursday, with around 29 million kilowatt hours of gas flowing over a one-hour period. That's around 40% of the gas that was moving through the pipeline this time last year, which is in line with the level of flows seen before the maintenance period.

The price of natural gas has soared this year in Europe, driving up inflation and heaping pressure on the European Union's economy. Natural gas and manufactured gasses made up 22% of the EU's final energy consumption in 2020.

However, the benchmark Dutch TTF natural gas futures price fell on Thursday as Nord Stream flows resumed, and was last down 3.3% to 149.90 euros per megawatt hour. It was still up around 600% from a year earlier.

Given the importance of Russian natural gas to Europe's economy, analysts have said a stop in flows could spell disaster on the continent. Russia has already cut supplies through the Nord Stream pipeline by around 60%, blaming sanctions for holding up the delivery of a piece of equipment from Canada.

Some of those economic fears will have eased on Thursday, although analysts — and Europe's politicians — will be keeping close tabs on flows.

"There can be no guarantee that European dependency on Russian gas will not be used as leverage further down the road," said Antoine Bouvet, senior rates strategist at Dutch bank ING. "An energy crunch over winter still looms large."