German energy giant Uniper said on Friday it will have to withdraw gas from storage facilities, reducing supplies for the winter even as Europe is experiencing an extreme heat wave.
The controversial utility told CNBC in a statement that reducing the volumes of gas from its storage facilities was necessary "to supply gas to our customers and safeguard Uniper's liquidity."
Finland's majority shareholder Fortum said last week that Uniper presented a bailout plan to the German government after falling into severe financial hardship due to gas shortages and rising prices.
The German economy ministry said Friday that there is still no timetable for state aid, according to Reuters.
Speaking to reporters at a press conference on July 8, Uniper CEO Klaus-Dieter Maubach warned that the withdrawal of gas supplies from its storage facilities is a possibility due to the "massive decline" of imported gas from Russia.
It also comes as Europe is suffocating amid a heat wave that has seen temperatures exceeding 40 degrees Celsius (104 degrees Fahrenheit) in several countries. Droughts and wildfires have been recorded in Spain and Portugal, and oppressive temperatures have spread to the United Kingdom and France. Climatologists have repeatedly made it clear that human-caused global warming makes heat waves more likely and more intense.
As scorching temperatures spread across the region, European politicians remain focused on preparing for the cold to return.
Governments are scrambling to fill underground storage with gas supplies to provide households with enough fuel to keep lights on and homes warm in winter.
"Really hard" in a few months
Uniper was the first German energy company to sound the alarm over soaring energy bills after the Russian attack on Ukraine. The company has received only 40% of the contracted volumes in Russia in recent weeks and is forced to purchase the replacement volumes at significantly higher prices.
In addition, the annual maintenance of the Nord Stream 1 pipeline, the largest gas import infrastructure in the European Union, has fueled fears of further gas supply disruptions.
Russia suspended deliveries through the Nord Stream 1 pipeline on 11 July. The summer maintenance works will last until 21 July.
Germany fears that for "political reasons" Russia may continue to limit Europe's energy supply after the planned end of maintenance on the Nord Stream 1 pipeline.
The Kremlin has previously rejected claims that it is using oil and gas to exert political pressure on Europe. Dan Yergin, vice president of S&P Global, stressed that Russian President Vladimir Putin outlined Moscow's energy strategy at the St Petersburg International Economic Conference last month.
Putin spoke of economic difficulties due to energy problems in Europe leading to social conflicts, leading to the rise of populist parties that would be more pro-Russia. And, as he said, a change in the elites in Europe, "Yergin said.
Putin's goal "is to break the alliance," he told CNBC's "Capital Connection" on Friday. “And so… the next few months are going to be really tough. It will be a race to see if Europe can have enough petrol to make it through the winter and Russia, I think, will do everything to make sure it doesn't get there. "
Yergin said he expects Europe's winter energy problems "to reverberate around the world".