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Germany activated the second phase of its three-step emergency gas program on Thursday, bringing it one step closer to rationing supply to industry – a step that would deal a blow to the manufacturing heart of its economy.

“Gas is now scarce in Germany,” Economy Minister Robert Habeck told reporters at a press conference in Berlin.

The region’s energy crisis worsened this month as Russia further cut deliveries to Germany and other European Union countries.

Russia’s state-owned gas company Gazprom cut flows through the Nord Stream 1 gas pipeline to Germany by 60% last week, blaming the move on the West’s decision to withhold a vital turbine due to sanctions. Italian energy giant ENI also said it had been told Gazprom would cut supplies by 15%.

Habeck called on Germans to reduce their gas consumption as part of a national effort to prepare for the “coming winter months”.

The German government’s decision to raise the “alarm” level follows cuts in Russian deliveries made since June 14 and the still high gas market price, Habeck added.

“We are in an economic confrontation with Russia,” Habeck said.

Habeck said that while German gas storage facilities are 58% full – more than this time last year – the target of reaching 90% by December will not be achievable without additional measures.

— This is a developing story and will be updated.


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