London Verdict: Gazprom Denied Compensation for Nord Stream Pipeline Blowups
The Russian company Gazprom lost its London lawsuit seeking compensation for the Nord Stream pipeline blowups. The Russians supported their claims with evidence from the German investigation into the matter.
A lawsuit brought by Nord Stream AG, a Swiss subsidiary of the Russian company, against Lloyd's Insurance Company and Arch Insurance ended in a defeat for Gazprom at the High Court of Justice in London.
Gazprom claimed a massive €580 million in compensation for the blowup of both lines of the Nord Stream 1 Baltic gas pipeline from Russia to Germany at the end of September 2022.
The Kremlin-controlled Russian energy giant Gazprom holds a controlling stake of 51% in Nord Stream AG.
Following Russia's invasion of Ukraine, its Western shareholders withdrew their representatives from the company's management. This means that Gazprom is now solely responsible for its actions.
War or Terrorism
In 2022, three of the four pipelines of the Nord Stream 1 and Nord Stream 2 gas pipelines in the Baltic Sea, near Denmark, were destroyed by explosions at a depth of approximately 80 meters.
Russian gas flowed to Germany through these pipelines for years, despite protests from countries including Poland, Ukraine, and the Baltic states.
Germany's ARD and the newspapers "Sueddeutsche Zeitung" and "Die Zeit" simultaneously reported that three Ukrainian diving instructors were involved in the attacks on Nord Stream. The German prosecutor's office issued a European arrest warrant for one of them.
The Financial Times noted that no country claimed responsibility for the explosions. Two Ukrainian suspects were detained, one in Italy and one in Poland. Rome handed over the suspect to German prosecutors, who face charges including complicity in sabotage.
Polish authorities refused to extradite the detained Ukrainian, who was released on all charges.
What the ruling means
The Financial Times explained that the ruling means that Western insurers – led by Lloyd's – will not have to pay compensation, as they successfully proved that the damage was the result of a full-scale Russian invasion of Ukraine.
The judge, however, said that even in that case the pleas' motives would have been shaped by the war.
After the blowup of both lines of the Nord Stream 1 gas pipeline and one of the twin lines of the Nord Stream 2 system, Gazprom demanded compensation from the insurers for losses caused by the destruction of the pipes.
The insurers refused. They explained that the blowup of Nord Stream was related to Russia's war against Ukraine, and the policy excludes compensation for war losses.
In response, in February 2024, Gazprom sued the insurers in a London court, seeking over €400 million in compensation. In the fall of 2025, Gazprom increased its claim to approximately €580 million.
Gazprom shares hit
Gazprom shares hit a more than 17-year low of 91.55 rubles on Tuesday, their lowest since November 2008.
The company's shares had fallen below 95 rubles the day before, breaking the level last traded at the height of the global financial crisis. Gazprom's market capitalization has fallen to about 2.22 trillion rubles.
As of 3:25 p.m. London time, shares in the Russian oil and gas giant were trading at 92.11 rubles.
Sources: "The Financial Times", Money.pl, Tradingview.com.