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Russia Suspends Gas Supplies to Poland, Bulgaria Over Failing To Pay In Roubles

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Russian owned energy firm Gazprom on Wednesday said it had halted gas supplies to Bulgaria and Poland for failing to pay in roubles, the Kremlin’s toughest retaliation yet to international sanctions over the war in Ukraine.

Poland confirmed that supplies had been cut, while Bulgaria said it would find out soon. Both accused Gazprom of breaching longstanding supply contracts.

“Because all trade and legal obligations are being observed, it is clear that at the moment natural gas is being used more as a political and economic weapon in the current war,” Bulgarian Energy Minister Alexander Nikolov said.

Gazprom said in a statement it had “completely suspended gas supplies to Bulgargaz and PGNiG due to absence of payments in roubles,” referring to the Polish and Bulgarian gas companies.

Russian President Vladimir Putin demanded that buyers from “unfriendly” countries pay for gas in youbles or be cut off, starting from the date payments are due for April. The European Union has rejected this demand as rewriting contracts that called for payment in euros.

Poland receives its Russian gas through the Yamal-Europe pipeline from Russia’s huge gas fields in the Arctic far north, which continues west to supply Germany and other European countries. Bulgaria is supplied through pipes over Turkey.

Polish state-owned PGNiG confirmed its supplies from Gazprom had been cut but said it was still supplying its own clients as needed.

“Cutting gas supplies is a breach of contract and PGNiG reserves the right to seek compensation and will use all available contractual and legal means to do so,” the company said.

Supplies from Gazprom cover about 50% of Poland’s consumption and about 90% of Bulgaria’s. Poland said it did not need to draw on reserves and its gas storage was 76% full. Bulgaria has said it is in talks to try to import liquefied natural gas through Turkey and Greece.

Russia’s energy exports had until now continued largely unhindered since the war began, the biggest loophole in sanctions that have otherwise cut off Moscow from much of its trade with the West.

Kyiv has called on Europe to stop funding Moscow’s war effort by cutting off energy imports that bring Russia hundreds of millions of dollars a day.

Germany, the biggest buyer of Russian energy, said this week it is hoping to stop importing Russian oil within days. But weaning Europe off cheap and abundant Russian natural gas, which heats its houses, fuels its factories and drives its electric power plants, would be a far more disruptive prospect.

Andriy Yermak, chief of staff to Ukraine’s President Volodymyr Zelenskiy, said Russia was “beginning the gas blackmail of Europe”.

“Russia is trying to shatter the unity of our allies,” Yermak said.

Reuters 

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