Eni CEO hopes halt to Russian gas flows will be resolved this week

By Giselda Vagnoni

ROME (Reuters) -The head of Italy’s Eni said he expects a halt to Russian gas flows to the company to be resolved by the end of this week, saying it had been caused by regulatory issues in Austria and not by geopolitics.

Russia has slashed gas deliveries to Europe since the West imposed sanctions over Moscow’s invasion of Ukraine in February, sparking a broad energy crisis.

However CEO Claudio Descalzi insisted that the drop in flows from Russia’s Gazprom via the Tarvisio entry point in northern Italy flagged on Saturday “has absolutely nothing to do with geopolitical factors”.

“It is due to the fact that Gazprom would have to pay a monetary guarantee for the transport of gas from Austria to Italy that was not there before,” he said, adding that the guarantee amounts to 20 million euros ($19.6 million).

Eni was checking whether the Italian group could replace Gazprom or the Austrian operator for the physical handover of Russian fuel which was already in Austria, he said.

Despite the latest stoppage, gas supplies to Italy have outstripped domestic demand, allowing some shippers to sell gas outside the country, taking advantage of higher prices at the Netherlands’ Title Transfer Facility (TTF) hub, Descalzi said.

To avoid some gas going to foreign markets, Italy could step up additions into the country’s storage, moving towards 100% of capacity, Descalzi said. Other European countries have heavily ramped up their stockpiling of gas ahead of winter.

Gas flows have recently been arriving through Tarvisio at a rate of around 20 million metric cubes a day, equal to 10% of total imports to Italy, he added.

($1 = 1.0226 euros)

(Reporting by Giselda Vagnoni; Writing by Francesca Landini, Cristina Carlevaro and Federico Maccioni; Editing by Agnieszka Flak and Jan Harvey)