European gas benchmark futures fell by almost 5% as Russian gas giant Gazprom announced it is resuming supplies to Italy via Austria after resolving regulatory issues that were halting transit flows.
A statement posted on Thursday by Gazprom said it found a solution with Italian buyers to overcome the regulatory changes made in Austria last month.
Dutch TTF gas futures fell by almost 5% as the news came out.
Gazprom, together with its Italian buyers, has managed to find a solution regarding the format of cooperation against the backdrop of regulatory changes introduced in Austria in September this year, Gazprom said on Telegram.
Italian energy provider Eni ENI has confirmed that flows have been started again, according to a statement on its website.
The resumption of supplies was made possible by the resolution by Eni and the parties involved of the constraints that are due to the new legislation introduced by the Austrian regulatory authorities, the firm said.
The spat started last weekend when Gazprom said deliveries have been suspended, just days after Russian gas pipelines Nord Stream 1 and 2 were sabotaged, causing major gas leaks in the Baltic Sea.
The issues between Gazprom and the Austrian government have been ongoing over regulatory and contractual signings. The Austrian government stated that Gazprom had not signed the contracts required.
Eni CEO Claudio Descalzi said the issue has absolutely nothing to do with geopolitical factors. The Austrian legislation now requires Gazprom to pay a monetary guarantee for gas deliveries, around €20 million $19.9 million, according to Descalzi.
He said at an event on Monday that Gazprom refused to pay the guarantee and that the suspension of gas flows was caused by the suspension of gas flows.
Gazprom said in its statement that the Austrian operator has signaled its readiness to confirm the transport nominations of Gazprom Export, making it possible to resume supplies of Russian gas across Austria. In France, the regulator CRE said that users should still try to conserve energy due to the ongoing market tensions and high prices, even though the country's gas storage facilities have hit 99% for the winter ahead.
The CRE said suppliers had 130 terawatt-hours of gas reserves, which is enough for gas consumption for two-thirds of French citizens and small to medium sized companies.
It said that storage will be full with gas imports from Norway, liquefied natural gas imports and exchanges with other countries during the winter season.