Europe's largest economy, Germany now faces the risk of a recession if Russia's gas supplies are completely cut off, an industry body warned on Tuesday.
The German industry association BDI lowered its forecast of economic growth for 2022 to 1.5% from the 3.5% expected before the Russian war in Ukraine began on February 24th.
It warned that a halt in Russian gas deliveries would make a recession in the country inevitable.
To this day, Russian gas is said to still be pumped through Ukraine but at a limited rate.
The Nord Stream 1 pipeline under the Baltic, the main supply route to Germany is operating with a capacity of only 40%.
According to Russia, the reduction came because Western sanctions had prevented repairs from being made, but Europe claimed it was merely an excuse for Moscow to reduce its flow.
The reductions prevent Europe from replenishing storage facilities which now require 55% to meet the EU -wide target of 80% by October and 90% in November in preparation for winter.
The benchmark gas price for Europe traded around € 126 ($ 133) per megawatt hour (MWh), well below this year’s high of € 335 euros, but still up more than 300% from a year ago.
