Russia orders block on Caspian oil pipeline that could pull 1 million barrels a day from Europe's supply
Russia has forced the Caspian oil pipeline to suspend activity for a month, according to Reuters.
The suspension comes in response to alleged oil spillages committed by the CPC.
Energy markets are facing a crisis, with the EU fearing Russia will totally cut off gas supplies.
A Russian court has ordered the Caspian Pipeline Consortium (CPC), which transports oil from Kazakhstan to the Black Sea, to suspend operations for 30 days.
The ruling Tuesday has the potential to cut another 1 million barrels per day of crude supply to Europe, when the continent is already mired in an energy crisis.
The pipeline is one of the world's largest, handling 1% of global oil flows, and CPC said it plans to appeal the suspension in the Novorossiysk court.
The block could weigh heavily on Kazakhstan, which transports 80% of its energy exports via the CPC pipeline, per Bloomberg. The nation is now scrambling to find another way to get oil to Europe, which has taken blow after blow during the ongoing energy war.
The ruling was made in relation to breaches of environmental regulations, specifically oil spillages, Reuters reported.
The forced shutdown comes just days after Kazakh President Kassym-Jomart Tokayev told the European Union the country was "ready to use its hydrocarbon potential for the sake of stabilization of the global and European markets."
That's prompted speculation that Russia is retaliating to moves by the G7 and EU to look at imposing a price cap on Russian energy exports. The EU is already phasing in a ban on seaborne imports of Russian oil, while the US and UK have restrictions on its exports in place.
After Russia invaded Ukraine, the West rapidly imposed sanctions on the country's energy exports in an effort to punish it for its unprecedented aggression. That has contributed to surging oil prices across the EU due to reduced supply, and has been a key driver of high levels of inflation that have stung the US economy in recent months.
Kazakh President Kassym-Jomart Tokayev said Thursday his government should look to diversify its oil supply routes following the halt, per Reuters.
Russia recently stoked tensions with the West when the state-owned gas giant, Gazprom, cut gas flows to Germany via the key Nord Stream 1 pipeline by 60% from last month. It also halted gas supplies to Poland and Bulgaria in April, after the two countries refused to pay in rubles.
European countries have drafted emergency plans in the event that Russia completely turns off its gas supply to the region. Countries like Germany, Italy, the Netherlands, and Austria have signaled a shift to coal as a backup plan in case the situation with Russia escalates.
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