Ukraine Latest: Gas Pipeline Sabotage Suspected by US, Germany


(Bloomberg) -- Officials of US, Germany and Poland cited the prospect of sabotage by Russia after Swedish scientists said they detected two powerful underwater explosions near enormous leaks coming from the Nord Stream pipeline system that usually supplies Europe. The prime ministers of Denmark and Sweden said more emphatically that the leaks were no accident.

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Kremlin spokesman Dmitry Peskov said that Russia is "extremely concerned" about the reports of leaks, which prompted a surge in gas prices even though flows through the pipeline have been halted for months. Meanwhile, Russia's Gazprom warned that a major source of Europe's gas flows through Ukraine was at risk of being sanctioned because of a legal feud. European natural gas extended gains.

Ukrainian President Volodymyr Zelenskiy said the current focus of the war is Donetsk, describing the heavily industrial eastern region as the "primary target" for both Ukraine and invading Russian forces. He also urged the international community to step up pressure on Russia with sanctions.

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

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On the Ground

Russian forces hit Kryvyi Rih airport in the Ukraine's central Dnipropetrovsk region with a missile, rendering it inoperable, local authorities said late Monday. Russian rockets also struck the city of Zaporizhzhia. Ukraine's General Staff reported that the situation at the Zaporizhzhia nuclear power plant remains tense, with staff reluctant to work with Russians and trying to flee occupied territories. In the south, Russia attacked the Odesa region with drones, all three of which were shot down by air-defense forces, while the city of Mykolaiv was heavily shelled overnight, local authorities said. Ukrainian forces continued to make advances north of Lyman and on the eastern bank of the Oskil River, according to the latest report by the Washington-based Institute for the Study of War.

All times CET:

Denmark, Sweden Say Nord Stream Leaks Caused Deliberately (9:37 p.m.)

Danish and Swedish governments both concluded that the leaks on the Nord Stream gas pipelines were the result of deliberate actions.

Denmark's Prime Minister Mette Frederiksen told reporters late Tuesday in Copenhagen that "several explosions have occurred" and they're "not an accident," though her government wouldn't speculate on who's responsible. Sweden's cabinet, which held an emergency meeting on Tuesday, is treating the events in the Baltic Sea as "suspected sabotage," Prime Minister Magdalena Andersson told reporters.

Both premiers said the incident can't be seen as an attack against their nations because it occurred in the Nordic countries' exclusive economic zones, which are in international waters and not part of their territories.

EU Eyes Ban on Work in Top Jobs at Russia State Enterprises (9:31 p.m.)

The European Union is considering a German proposal to ban EU nationals from holding high-paying roles in Russian state-owned companies, according to people familiar with the matter.

The proposal, if formally presented by the European Commission and backed by all member states, would cast a wide net over EU nationals. As a result, it would be likely to scoop up former German Chancellor Gerhard Schroeder, said the people who declined to be named on confidential talks.

According to German media, Schroeder is the chairman of the shareholders' committee of Nord Stream AG, a joint project to transport Russian gas via pipeline, which is majority-owned by the energy giant Gazprom PJSC.

Read the full story here.

NATO Monitoring Nord Stream Leaks, Stoltenberg Says (7:13 p.m.)

NATO Secretary General Jens Stoltenberg said the military alliance was closely monitoring the reports of the Nord Stream leakages, adding NATO was in close contact with the allies involved.

"This is something that is extremely important to get all the facts on the table. and therefore this is something we'll look closely into in the coming hours and days," he said.

Blinken Says Reports Indicate Nord Stream Leaks Were Sabotage (6:37 p.m.)

Leaks in the Nord Stream pipeline are under investigation and initial reports indicate they may have been the result of sabotage, US Secretary of State Antony Blinken said.

"There are initial reports indicating that this may be the result of an attack or some kind of sabotage, but these are initial reports and we haven't confirmed that yet," Blinken told a news conference in Washington.

Blinken said the US and its allies were "working day in, day out" to address Europe's energy security, and "the leaks will not have a significant impact on Europe's energy resilience."

Russia Prepares to Declare Staged Annexation Votes Passed (6:22 p.m.)

Occupation authorities in Russian-held parts of Ukraine reported as many as 90% of those voting favored joining their eastern neighbor in initial returns from "referendums," as officials in Moscow said they plan to move quickly to formalize the annexation.

The United Nations, as well as Ukraine and its allies in the US and Europe, have denounced the votes, conducted largely in an active war zone, as illegal and illegitimate.

Gazprom Warns of Sanctions Risk to Ukraine Gas Flows (5:30 p.m.)

Russia's Gazprom PJSC warned there's a risk Moscow will sanction Ukraine's Naftogaz, which would prevent it from being able to pay transit fees, and therefore put at risk gas flows to Europe via Ukraine.

If supplies through Ukraine are shut down, it would leave Gazprom sending gas only via the TurkStream pipeline to Turkey and a handful of European countries that didn't sever business ties with Russia.

Gas prices were up as much as 22% as traders factored in the prospect that Europe will have to live without Russian gas this winter -- and beyond.

Read more: After Nord Stream Hit, Gazprom Warns on Ukraine Flows

Ukraine Demands EU Add New Russia Sanctions (5:25 p.m.)

Ukraine seeks a clear signal on a new sanctions package in reaction on sham referendums being held on its territory by Russia, Zelenskiy said during a meeting with French Foreign Minister Catherine Colonna. "We expect clear sanctions -- both in the 8th package and separate signals of what will happen if Russia recognizes sham referendums," Zelenskiy added.

Russia Senate May Vote to Annex Ukraine Lands Next Week: Tass (4:10 p.m.)

The upper house of Russia's parliament isn't currently planning a special session to vote to annex occupied territories in Ukraine and may discuss the issue at its next regular session on Oct. 4, Speaker Valentina Matviyenko said, according to Tass.

The Kremlin has pushed through "referendums" on annexation in the Donetsk, Luhansk, Zaporizhzhia and Kherson regions and local occupation officials are already reporting initial results showing 90%-plus voting in favor. The United Nations has condemned the "referendums" as illegal, as have Kyiv and its allies in the US and Europe.

Sweden Detected Underwater Blasts Near Nord Stream Leak (4 p.m.)

Two powerful underwater explosions were detected on Monday in the same area of sea as the Nord Stream gas leaks, according to the Swedish National Seismic Network.

The monitoring network said the first explosion occurred on Monday at 2:03 a.m. Swedish time with a magnitude of 1.9 on the Richter scale, followed by a second at 7:04 p.m. on the same day with a magnitude of 2.3.

"It's clear that there has been some kind of explosions, and the coordinates match the leaks," Peter Schmidt, a seismologist who works with the group, said by phone.

Danish Video Shows Extent of Pipeline Damage (3:20 p.m.)

The leaks on the Nord Stream pipelines are forming an area of natural gas bubbles about 1 kilometer (1,090 yards) in diameter in the Baltic Sea, a video released by the Danish army showed.

Another smaller area with gas bubbles measured about 200 meters in diameter, according to the footage, which the Danish Defense shared on its website and via its Twitter account.

UN Recorded Near 6,000 Civilian Deaths in Ukraine (3 p.m.)

United Nations specialists recorded 5,996 civilians being killed in Ukraine since the beginning of the Russian invasion, including 382 children, the UN Human Rights Monitoring Mission in Ukraine said in a new report.

The mission reported 8,848 corroborated civilian injuries, noting that actual figures may be much higher as hostilities severely hinder information gathering and verification.

Most of civilian casualties were due to the use of explosive weapons in populated areas. The UN also recorded willful killings and numerous cases of arbitrary detention and enforced disappearances, torture and ill-treatment, as well as conflict-related sexual violence, mostly in the territories controlled by Russian armed forces or affiliated groups.

Meta Blocks Propaganda Accounts From Russia (2:45 p.m.)

Meta Platforms Inc. has blocked thousands of "inauthentic" accounts, pages and groups from Facebook and Instagram that originated in Russia and spread propaganda about that country's invasion of Ukraine.

The group behind the accounts created 60 websites "carefully impersonating legitimate news organizations in Europe," Meta said.

Russian Billionaire Fights UK Sanctions Probe (2:40 p.m.)

Russian billionaire Petr Aven, fighting a UK investigation for evading sanctions, used companies supposed to manage his luxury mansion as a personal "piggy bank," according to British authorities.

The investigation has focused on around 3.7 million euros ($3.6 million) routed to the UK from an Austrian trust in the hours before European sanctions were imposed.

Read more: Billionaire Without a Bank Account Fights UK Sanctions Probe

Denmark Says Pipeline Sabotage Can't be Ruled Out (12:50 p.m.)

Denmark's prime minister, Mette Frederiksen, echoed Peskov is saying that sabotage cannot be ruled out as the cause of damage to Nord Stream infrastructure off the island of Bornholm in the Baltic Sea.

"It's hard to imagine that these are coincidences," the prime minister said in an interview with broadcaster TV2 from Poland, where she's attending the opening ceremony of Baltic Pipe, a separate gas link between Norway and Poland.

Ukraine Slams Lufthansa Over Stake in Russian Airline Caterer (12:15 p.m.)

Ukraine's foreign minister accused airline Deutsche Lufthansa AG of taking "blood money" and damaging Germany's reputation over its minority stake in Russian airline caterer Aeromar.

"I urge the company's management to immediately withdraw from Aeromar and stop supporting Russia's war crimes," Dmytro Kuleba said in an interview with German public broadcaster ZDF. Responding to ZDF's inquiry about the Aeromar stake, Lufthansa said it's not in breach of European Union sanctions on Russia and as a minority shareholder had no influence over a decision to establish a facility in Russian-annexed Crimea, the broadcaster said.

Nord Stream Says Pipeline Damage Unprecedented (10:45 a.m.)

Nord Stream said the damage to its key pipeline to Germany is "unprecedented" and it's impossible to say when flows could resume.

Germany is probing the incidents in the Baltic Sea on the two idled Nord Stream gas pipelines from Russia, while Denmark steps up security on its energy installations. It's the clearest signal yet that supplies won't resume this winter. European Union officials have repeatedly accused Moscow of weaponizing energy.

Latvia 'Taking Russian Nuclear Threats Seriously' (10:20 a.m.)

Russia wouldn't be making threats about deploying nuclear weapons if it was winning its war in Ukraine, Latvian Foreign Minister Edgars Rinkevics said in an interview with TV3.

"A cornered rat is a dangerous rat" and Latvia is preparing for all scenarios, Rinkevics said. Latvia is supplying Ukraine with all the military equipment it has available and a swift end to the conflict isn't in sight, he added.

Lithuania Arms Donations Constrained by NATO Needs (10 a.m.)

Lithuania cannot immediately hand over some critical military equipment that Ukraine needs such as NASAMS air-defense systems or howitzers without compromising operations with its NATO partners, according to an adviser to the Baltic nation's president.

Lithuania is looking to find replacements for the equipment but this is unlikely to happen quickly, Kestutis Budrys, the president's chief national security adviser, told radio broadcaster LRT. Lithuania has already supplied Ukraine with 50 armored personnel carriers, according to Defense Minister Arvydas Anusauskas.

Russian Traffic on Finnish Border Easing Further (8:45 a.m.)

Traffic on Finland's eastern border remained busy on Monday, even as numbers of Russians crossing fell from a weekend peak, the Nordic country's Border Guard said. Some 7,743 Russians entered via the land border, with about half that number returning to Russia.

Europe Ready for Winter Without Russian Gas: BNEF (8:30 a.m.)

Europe's frenzied buying of liquefied natural gas means it's likely to have enough of the power-generation fuel this winter to offset supplies from Russia, according to BloombergNEF.

The region may import almost 40% more LNG during the coming winter than the prior year, and it may increase purchases next summer by about 14% to rebuild lost inventories, BNEF said in a report. Along with demand destruction from higher energy prices, those shipments are enough to cover a complete halt in Russian pipeline flows from Oct. 1, it added.

Russia Expels Japanese Diplomat on Spying Charges (2:32 a.m.)

Russia expelled a Japanese consul in Vladivostok, accusing the diplomat of paying for sensitive information.

Tatsunori Motoki was given 48 hours to leave the country, the Foreign Ministry said, according to Tass. Earlier, the Federal Security Service said the envoy in the Far Eastern city had been caught collecting "restricted information" about Russia's ties with an unspecified country in the region, as well as on the impact of sanctions on the local economy.

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