Algeria’s Gas Supply to Spain Temporarily Suspended

 Part of the Medgaz underwater natural gas pipeline between Algeria and Spain. (Reuters)
Part of the Medgaz underwater natural gas pipeline between Algeria and Spain. (Reuters)
TT

Algeria’s Gas Supply to Spain Temporarily Suspended

 Part of the Medgaz underwater natural gas pipeline between Algeria and Spain. (Reuters)
Part of the Medgaz underwater natural gas pipeline between Algeria and Spain. (Reuters)

A malfunction in the Medgaz underwater natural gas pipeline between Algeria and Spain has caused a temporary suspension of gas supplies to Spain on Sunday, Algerian state media said, citing a statement from state oil and gas producer Sonatrach.

The malfunction occurred on the Spanish side, and Spain is working on fixing it to ensure the resumption of supplies as soon as possible, Sonatrach added, according to state media.

Sonatrach is a key gas supplier to Spain and France.

However, tensions are simmering between Algiers and Madrid over recent Spanish comments on Western Sahara as Spain has shifted closer to Morocco’s position on the conflict there.

In March, Algeria recalled its ambassador from Madrid in protest at Spain’s decision.

The global gas market has been witnessing rapid changes after the West imposed sanctions on Russia in response to Moscow's invasion of Ukraine, a gas transit route to Europe as well as a major wheat exporter.

As a result, European countries began searching for alternaticve gas suppliers, and resorted to the Middle East countries.

Algeria warned in April that it would terminate gas supplies to Spain if Madrid sold any Algerian gas to other countries, citing what it said was a Spanish decision to supply gas to Morocco via a pipeline.

Algeria has previously said it will stick to its contract with Spain despite withdrawing its ambassador.

Algeria decided last year not to extend a deal to export gas through a pipeline running through Morocco to Spain that made up nearly all Morocco's gas supply. It is supplying Spain through a direct subsea pipeline and by vessel.

Morocco now wants to import liquefied natural gas (LNG) from Spain by reversing the flow of the pipeline while it moves to develop its own longer-term LNG import terminals.

Algerian television, reporting the warning, said that Energy Minister Mohamed Arkab had received an email from his Spanish counterpart notifying him of Spain's decision to allow a reverse flow of the pipeline.

However, Spain's energy ministry said that in no case would gas acquired by Morocco come from Algeria and that it had discussed the plan with Algiers in recent months.



Gold Prices Climb on Safe-Haven Demand; US Payrolls Data in Focus

Gold bullion displayed in a store in the German city of Pforzheim (dpa)
Gold bullion displayed in a store in the German city of Pforzheim (dpa)
TT

Gold Prices Climb on Safe-Haven Demand; US Payrolls Data in Focus

Gold bullion displayed in a store in the German city of Pforzheim (dpa)
Gold bullion displayed in a store in the German city of Pforzheim (dpa)

Gold prices climbed on Friday, supported by safe-haven demand arising from the Middle East conflict, while spotlight shifted towards US payrolls report to gauge the trajectory of the Federal Reserve's policy path.
Spot gold was up 0.3% at $2,662.50 per ounce, as of 0325 GMT, after climbing to an all-time high of $2,685.42 on Sept. 26. Bullion has gained 0.2 for the week.
US gold futures edged 0.1% higher to $2,682.10.
The dollar eased 0.1%, pulling back from over a one-month high, making greenback-priced bullion less expensive for other currency holders, reported Reuters.
Geopolitical tensions, particularly concerning Israel and Iran, are supporting gold prices and unless these risks subside, prices are likely to remain near record levels, said Ajay Kedia, director at Kedia Commodities, Mumbai.
The US is discussing strikes on Iran's oil facilities as retaliation for Tehran's missile attack on Israel, President Joe Biden said, while Israel's military hit Beirut with new air strikes in its battle against Lebanese armed group Hezbollah.
Bullion is considered a safe investment during times of political and financial uncertainty, and thrives in a low-rate environment.
The US nonfarm payroll data is due at 1230 GMT. New York Fed President John Williams and Chicago Fed President Austan are also scheduled to speak later in the day.
If the NFP report comes in strong, it will be positive for the dollar and then gold prices will see some profit-booking, Kedia added.
Traders see a 69% chance of a 25-basis-point Fed rate cut in November, according to CME FedWatch Tool.
BMI said in a note it expects gold prices to trade within the range of $2,500 to $2,800 in the coming months.
Spot silver rose 0.4% to $32.17 per ounce and has gained about 1.8% so far this week.
Platinum climbed 1.1% to $1,001.79 and palladium advanced 1.4% to $1,013.46.