Russia pounds Ukraine as uncertainty swirls over gas pipeline restart

By Natalia Zinets

KYIV (Reuters) - Russian forces shelled eastern and southern Ukraine on Wednesday after Washington said it saw signs Moscow was preparing to formally annex territory it has seized during nearly five months of war.

Uncertainty swirled meanwhile over the planned restart on Thursday of a huge Russian gas pipeline to Europe, as Russian President Vladimir Putin warned that its capacity could be further reduced due to slow progress in equipment maintenance.

Fearing Russia could cut off deliveries, the European Union will set out emergency plans to reduce gas demand within months.

Ukraine's military and politicians reported heavy and sometimes fatal Russian shelling amid what they said were largely unsuccessful attempts by Russian ground forces to advance.

British military intelligence said Russia's offensive in the eastern Donbas region continued to make minimal gains as Ukrainian forces - which Britain helps support - held the line. More than two weeks have passed since Russia's last major territorial gain, the city of Lysychansk.

The Kremlin has said there is no time limit to what it calls a "special military operation" to ensure its own security in the face of NATO's expansion, and that it will do whatever it takes to achieve its aims.

Ukraine and the West condemn the conflict as an unprovoked war of aggression by Russia against its neighbour.

Five civilians were killed and 16 wounded by Russian shelling in the Donetsk region, while two civilians were killed by shelling in the city of Nikopol in the south, the respective Ukrainian regional governors said on Telegram.

Roman Starovoit, governor of Russia's Kursk region, which borders Ukraine, wrote on Telegram that Ukrainian forces had shelled a border crossing there.

Russia's TASS news agency meanwhile cited the mayor of Horlivka, a city in the Russian-backed self-proclaimed Donetsk People's Republic in eastern Ukraine, as saying that one person had been killed and three injured, including a child, by Ukrainian shelling.

Reuters could not immediately verify the Ukrainian or Russian accounts.

Russian Defence Minister Sergei Shoigu has inspected troops fighting in Ukraine, his ministry said on Wednesday. It cited him as ordering more to be done to shoot down Ukrainian drones operating in border regions and to stop Ukraine shelling areas it has lost control of.

Citing U.S. intelligence, White House national security spokesman John Kirby (NYSE:KEX) accused Russia of laying the groundwork to annex Ukrainian territory it had seized since the start of the war on Feb. 24, an assertion the Russian embassy in Washington said mischaracterised what Moscow was trying to do.

The embassy cast what Ukraine and the West regard as a naked land grab as "returning peace to liberated territories" in order to protect the rights of people regardless of their ethnicity or language - a reference to Russian speakers or ethnic Russians in Ukraine who Russia says it is saving from persecution at the hands of what it has cast as dangerous Ukrainian nationalists.

Kyiv says that Russian narrative is false.

NORD STREAM 1

Russian natural gas exports via the Nord Stream 1 pipeline to Germany are due to restart on Thursday after 10 days of annual maintenance work.

Sources have told Reuters that Nord Stream, the single largest link for Russian gas supplies to Europe, is expected to resume as scheduled but at reduced capacity.

Speaking to reporters on Wednesday after a visit to Tehran, Putin said the capacity of Nord Stream 1 could be reduced due to problems with other pumping units, one of which would need to be sent for maintenance on July 26.

He said Russian energy giant Gazprom (MCX:GAZP) was ready to fulfil its obligations on gas exports.

Gazprom cut exports through the route to 40% capacity last month, citing delays in the return of a turbine Siemens Energy was servicing in Canada, which had initially banned the equipment's return, citing sanctions.

The Kommersant newspaper reported on Monday, citing people familiar with the situation, that Canada had eventually sent the turbine needed for Nord Stream 1 to Germany by plane on July 17 after repair work had been completed.

The West has accused Russia, the world's largest gas exporter and second-largest crude oil supplier, of using its energy supplies as a tool of coercion. Russia denies those accusations, saying it has been a reliable energy supplier.

Setting out its emergency plan later on Wednesday, the EU will warn member countries that without reducing gas demand now they could struggle for fuel during winter if Russia cuts off deliveries.