Russian energy giant Gazprom
says it has halted gas exports to Poland and Bulgaria over the countries'
refusal to pay for supplies in roubles.
The firm said services will not be restored until payments are
made in the Russian currency.
It comes after Russian President Vladimir Putin ordered
"unfriendly" countries to pay for gas in roubles.
Poland confirmed supplies had stopped, but Bulgaria said it was
still unclear whether supplies had been halted.
Poland's deputy foreign minister said the country could cope
without Gazprom's gas and had "taken some decisions many years ago to
prepare for such a situation".
Marcin Przdacz told the BBC there were "options to get the
gas from other partners," including the US and gulf nations.
"I'm pretty sure that we will manage to handle this,"
he told the BBC.
Polish state gas company PGNiG, which bought 53% of its gas
imports from Gazprom in the first quarter of this year, described the
suspension as a breach of contract, adding that the company would take steps to
reinstate the gas supply.
Meanwhile in Sofia, energy minister Alexander Nikolov said
Bulgaria had paid for Russian gas deliveries for April and claimed supplier
Gazprom will be in breach of its current contract if it halts the flow.
"Because all trade and legal obligations are being
observed, it is clear that at the moment [Russian] natural gas is being used
more as a political and economic weapon in the current war," Mr Nikolov
said.
Bulgaria, which relies on Gazprom for more than 90% of its gas
supply, said it had taken steps to find alternative sources but no restrictions
on gas consumption were currently required.
The executive director of Bulgarian gas network operator
Bulgartransgaz said supplies to Bulgaria were still currently flowing.
Bulgaria also transports Russian gas via an extension of the
Turk Stream pipeline to neighbouring Serbia and from there to Hungary. Hungary
and Austria also said gas supplies were normal.
Russia's top lawmaker said on Wednesday that gas giant Gazprom
had made the right decision in suspending gas supplies to Bulgaria and Poland
and said Moscow should do the same with other "unfriendly" countries.
"The same should be done with regard to other countries
that are unfriendly to us," Vyacheslav Volodin, the speaker of Russia's
lower house of parliament, the Duma, wrote on his Telegram channel.
Ursula von der Leyen, president of the European Commission, said
Russia was using gas "as an instrument of blackmail".
"This is unjustified and unacceptable. And it shows once
again the unreliability of Russia as a gas supplier," she said.
Ms von der Leyen said the EU was "prepared for this
scenario" and had been "working to ensure alternative deliveries and the
best possible storage levels across the EU".
Nathan Piper, head of oil and gas research at Investec, told the
BBC the halting of supplies to Poland and Bulgaria was the "start of
Russia exerting economic pressure on Europe."
He said despite demand for gas declining as Europe enters
summer, "risks around Russian gas supply are keeping prices high, putting
pressure on consumers and industry".
The latest move by Russia sent European gas prices up further on
Wednesday, surging by 24%,
Russia's demand for gas to be paid in roubles has been seen as
an attempt to boost the rouble, which has been hit by Western sanctions.
Mr Putin's decree means foreign buyers of Russian gas would have
to open an account at Russia's Gazprombank and transfer euros or US dollars into
it.
Gazprombank would then convert this into roubles which will then
be used to make the payment for gas.
UK Deputy Prime Minister Dominic Raab earlier told Sky News the
decision to cut off gas supplies will have "a very damaging effect on
Russia," adding that such moves could lead to the country becoming
"an economic pariah".
Following Russia's announcement, Poland's climate ministry said
the country's energy supplies were secure.
Climate Minister Anna Moskwa said there was no need to draw gas
from reserves and gas to customers would not be cut.
Poland was already planning to stop importing Russian gas by the
end of the year, when its long-term supply contract with Gazprom expires.
PGNiG said its underground gas storage was almost 80% full and,
with summer approaching, demand was lower.
Poland also has alternative supply sources, including a
liquefied natural gas (LNG) terminal in Swinoujscie.
On 1 May, a new gas pipeline connection with Lithuania is also
due to open that will give Poland access to gas from Lithuania's LNG terminal.
And a new pipeline delivering gas from Norway, known as the
"Baltic Pipe", comes online in October. It should reach full capacity
by the end of the year and could replace all Russian deliveries.
Supplies from Russia account for about 40% of the EU's natural
gas imports.
However, many countries have pledged to move away from Russian
energy in response to its invasion of Ukraine.
The US has declared a complete ban on Russian oil, gas and coal
imports.
Meanwhile, the UK is to phase out Russian oil by the end of the
year, with gas to follow as soon as possible, and the EU is reducing gas
imports by two-thirds.
https://www.bbc.com/news/business-61237519
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