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Amid Ukraine endgame, some in Germany want Russian gas
Marilen Martin
5 min read
(Bloomberg) — Some German industries in the east of the country are already planning for the time when Russian gas returns to Europe encouraged by the efforts of US President Donald Trump to end the war in Ukraine.
Europe has spent three painful years weaning itself off gas from the east with the biggest impact felt in Germany, the region’s largest economy. German industry was built on cheap Russian gas and rising energy prices have already trammeled growth and forced some manufacturers to move production abroad.
For many politicians and businesses in Germany, the idea of buying Russian pipeline gas is still anathema. For example, chemicals giant BASF SE, a huge consumer before supplies were shut off, said this week it has no scenario involving the resumption of supply. But in Germany’s east, where economic stagnation and historic links with Russia make the idea more palatable, talk of bringing back supplies has already started in some quarters, even before a peace deal is done.
For Christof Günther, head of one of the biggest chemical industrial sites in Germany, the only way to revive sectors like his is to get hold of cheap Russian gas again. If Europe is expected to help finance Ukraine’s recovery in future, Germany needs to be economically strong to contribute, he said in an interview in Leuna.
“If peace is achieved, then we must of course ensure that the other damage caused by this conflict is repaired as well,” said Günther, managing director of the Leuna chemical park in eastern Germany. Returning to deliveries of Russian gas “would be the logical consequence.”
About one hour north of Leuna, another East German chemical producer in principle agrees. If peace returns to Europe in the mid- to long-term, gas purchases will also, even if a relapse into strategic dependency should be avoided, a spokesman of SKW Stickstoffwerke Piesteritz GmbH said. Günther’s proposal is right in terms of perspective as well as being ecologically and economically sensible, the company said.
If President Donald Trump successfully brokers an end to the Kremlin’s war in Ukraine, gas flows to Europe that were cut could resume. Heads of state will ultimately determine whether the shipments restart, a shift that could be politically unpalatable for some nations.
Possible routes include restoration of transit via Ukraine or the use of an undamaged Nord Stream link under the Baltic Sea, a direct conduit between Russia and Germany.
A few politicians are also starting to address the issue. The economy minister of Saxony-Anhalt, the state where the two chemical parks are located, said that a peace deal would change attitudes to energy from Moscow.
“If we can achieve peace and build long-term trust that Europe is not threatened by Russia, we must also be open to discussing the future supply of Russian gas,” said Sven Schulze. “I think it would be wrong to permanently rule out the resumption of gas supplies.”
Schulze holds this view despite being a member of the center-right CDU/CSU party, showing how the economic pressure is weighing even on the party of potential future Chancellor Friedrich Merz who is currently discussing a huge new defense package to support Ukraine.
A spokesperson for the German Economy Ministry declined to comment directly on speculation about the return of Russian gas flows.
Independence from Russian gas is of strategic importance to the German government in terms of security policy and is a top priority, the spokesperson said.
The return of some Russian volumes would help lower gas prices in Europe and provide a bridge until more liquefied natural gas starts arriving in the market from 2026, according to Jonathan Stern, distinguished research fellow at the Oxford Institute for Energy Studies.
“Longer term, it would depend on what kind of peace agreement and how well both sides adhered to it,” Stern said.
Restarting flows wouldn’t be easy. Gazprom PJSC’s biggest and oldest European buyers have already cut ties with Moscow. Germany’s Uniper SE and Austria’s OMV AG have terminated their contracts. The region has also moved to install more LNG terminals and signed up deals to receive the tanker-borne fuel from global producers, from the US to the UAE.
The European Union has committed to phasing out Russian energy by 2027 and is due to present a roadmap on how to achieve this next month.
“While some European buyers may still explore short-term transit solutions, EU policymakers have made it a strategic priority, so solving this contradiction will not be easy,” said Tatiana Mitrova, researcher at the Center on Global Energy Policy at Columbia University.
Any peace deal may also take months to finalize, followed by potentially lengthy discussions between Gazprom and its Ukrainian counterparts on details of any potential new transit, should Kyiv give its approval.
But with high energy costs contributing to Germany’s economic malaise, the issue is unlikely to go away. Manuela Grieger, former chair of the workers’ union at InfraLeuna, the company running the infrastructure of the chemical park, is also supportive of using Russian gas driven by concerns about the future of industry if prices remain high.
“We need peace,” she said. “We really need peace so that the pipelines open up again, so that the security of supply improves and we have reasonable prices.”
—With assistance from Petra Sorge and John Deane.
(Updates with reaction of Stickstoffwerke Piesteritz in sixth graph. An earlier version of this story was corrected to fix the name of the executive in the fourth paragraph.)
