(CMR) As Europe attempts to lessen its dependence on Russian oil, the US dollar and the euro are currently worth the same for the first time in 20 years.
Russia's invasion of Ukraine continues to affect European economies, with the euro falling about 12% since the start of the year. According to CNN, the European Union, which received roughly 40% of its gas through Russian pipelines before the war, is attempting to reduce its dependence on Russian oil and gas. At the same, Russia has throttled back gas supplies to some EU countries and recently cut the flow in the Nord Stream pipeline to Germany by 60%.
Now, Nord Stream 1 began annual maintenance on Monday that stops the flow of natural gas and will last for 10 days, but officials are worried the stoppage may be extended due to the war. The pipeline runs under the Baltic Sea and carries 55 billion cubic meters annually to Germany.
“Based on the pattern we've seen, it would not be very surprising now if some small, technical detail is found and then they could say ‘now we can't turn it on anymore',” said German Economy Minister Robert Habeck at an event at the end of June.
The energy crisis comes alongside an economic slowdown, which has cast doubts over whether the European Central Bank can adequately tighten policy to bring down inflation. The ECB announced that it would hike interest rates this month for the first time since 2011, as the eurozone inflation rate sits at 8.6%.
Many officials believe the gas throttling is a political gambit and retaliation by Russian president Vladimir Putin to pressure European countries that denounce his invasion of Ukraine. However, Russia has denied this and blamed the reduction in gas flow on technical issues. Gas prices have been further affected by strikes at Norway's largest oil fields.