Russia’s Gazprom Halts Gas Supplies to Poland, Bulgaria

[Rogue Valley]

Russia’s Gazprom Halts Gas Supplies to Poland, Bulgaria - The Moscow Times

Russia's energy giant Gazprom said Wednesday it had stopped all gas supplies to Poland and highly dependent Bulgaria after not receiving payment in rubles from the two EU members.

www.themoscowtimes.com

4.27.22
Russia's energy giant Gazprom said Wednesday it had stopped all gas supplies to Poland and highly dependent Bulgaria after not receiving payment in rubles from the two EU members. President Vladimir Putin last month said Russia will only accept payment for deliveries in its national currency, with buyers required to set up ruble accounts or have their taps turned off. Gazprom said in a statement it notified Bulgaria's state-owned gas operator Bulgargaz and Poland's PGNiG gas firm about the "suspension of gas supplies from April 27 until payment is made" in rubles. "Starting April 1, payments for gas need to be made using new bank details, about which the counterparts were informed in a timely manner," Gazprom said. The energy giant also warned that if Bulgaria or Poland make an "unauthorized withdrawal" of Russian gas that is transiting to third countries, "supplies for transit will be reduced by this volume."

Both Poland and Bulgaria — which is almost completely dependent on Russia for its annual consumption of gas — said they were notified by Gazprom on Tuesday that supplies would be cut off the next day. Bulgaria's economy ministry said the country "fully met its obligations and has made all payments required under its current contract in a timely manner." Prime Minister Mateusz Morawiecki said Poland's gas storage facilities were 76% full and that the country was ready to obtain necessary supplies from sources other than the Yamal pipeline.

I have been forcasting for years that Moscow would someday use energy exports as a weapon for geopolitical blackmail. That someday is today.

Poland has a working LNG terminal. This places Bulgaria in a tough spot. Bulgaria has not transferred any of its considerable stocks of Soviet-era weaponry to Ukraine because the pro-Russia Bulgarian Socialist Party has objected. Beginning today, Bulgaria's PM and representatives of the other three major parties will be visiting Poland and then on to Kyiv to see Zelenskyy tomorrow. Bulgaria country is a big manufacturer of Soviet-era ammunition, anti-tank missiles, and light arms, and will debate the Ukraine issue again upon the return of the PM to Sofia.

Ukraine Braces For 'Much Pain' From Russia's Offensive In East As EU Responds To Gas Cut

Ukraine's defense minister says the country has "extremely difficult weeks" ahead, warning of major "destruction" in an ongoing large-scale Russian offensive in the east of the country.

www.rferl.org

 

[Felis Leo]

Russia’s Gazprom Halts Gas Supplies to Poland, Bulgaria - The Moscow Times

Russia's energy giant Gazprom said Wednesday it had stopped all gas supplies to Poland and highly dependent Bulgaria after not receiving payment in rubles from the two EU members.

www.themoscowtimes.com

I have been forcasting for years that Moscow would someday use energy exports as a weapon for geopolitical blackmail. That someday is today.

Poland has a working LNG terminal. This places Bulgaria in a tough spot. Bulgaria has not transferred any of its considerable stocks of Soviet-era weaponry to Ukraine because the pro-Russia Bulgarian Socialist Party has objected. Beginning today, Bulgaria's PM and representatives of the other three major parties will be visiting Poland and then on to Kyiv to see Zelenskyy tomorrow. Bulgaria country is a big manufacturer of Soviet-era ammunition, anti-tank missiles, and light arms, and will debate the Ukraine issue again upon the return of the PM to Sofia.

Ukraine Braces For 'Much Pain' From Russia's Offensive In East As EU Responds To Gas Cut

Ukraine's defense minister says the country has "extremely difficult weeks" ahead, warning of major "destruction" in an ongoing large-scale Russian offensive in the east of the country.

www.rferl.org

Thank goodness Russia did this after Winter. It may give the Bulgarians time to find alternative suppliers.

 

[Rogue Valley]

Austria is one of four European countries that have complied with Moscow's demand for energy payments in Russian rubles.

Such payments are a violation of EU sanctions on Russia. 10 European buyers have opened the necessary accounts at Gazprombank needed to meet Russia’s payment demands.

The second half of May is when the next energy payments to Russia will be due.

Gazprombank is one of the few major Russian banks not disconnected from SWIFT. It seems like that will now be necessary.

 

[Rogue Valley]

Poland and Bulgaria say they won't bow down to Russia after Gazprom shut off their gas supply

 

[joluoto]

Russia’s Gazprom Halts Gas Supplies to Poland, Bulgaria - The Moscow Times

Russia's energy giant Gazprom said Wednesday it had stopped all gas supplies to Poland and highly dependent Bulgaria after not receiving payment in rubles from the two EU members.

www.themoscowtimes.com

I have been forcasting for years that Moscow would someday use energy exports as a weapon for geopolitical blackmail. That someday is today.

Poland has a working LNG terminal. This places Bulgaria in a tough spot. Bulgaria has not transferred any of its considerable stocks of Soviet-era weaponry to Ukraine because the pro-Russia Bulgarian Socialist Party has objected. Beginning today, Bulgaria's PM and representatives of the other three major parties will be visiting Poland and then on to Kyiv to see Zelenskyy tomorrow. Bulgaria country is a big manufacturer of Soviet-era ammunition, anti-tank missiles, and light arms, and will debate the Ukraine issue again upon the return of the PM to Sofia.

Ukraine Braces For 'Much Pain' From Russia's Offensive In East As EU Responds To Gas Cut

Ukraine's defense minister says the country has "extremely difficult weeks" ahead, warning of major "destruction" in an ongoing large-scale Russian offensive in the east of the country.

www.rferl.org

Poland also puts its hope to Baltic Pipe being finished at some point soon, meaning Norwegian gas can flow directly to Poland.

For Bulgaria this is pretty much pressure to get them further away from the West. It might backfire and do the opposite. Not the first time Russia does something that gets the opposite result they want. But Bulgaria is in a really tough spot without Russian gas, they basically have no fast alternative (most of their Russian gas comes via TurkStream, a gaspipe that connects Russia to Turkey and then further to Bulgaria).

 

[Rogue Valley]

Poland also puts its hope to Baltic Pipe being finished at some point soon, meaning Norwegian gas can flow directly to Poland.

For Bulgaria this is pretty much pressure to get them further away from the West. It might backfire and do the opposite. Not the first time Russia does something that gets the opposite result they want. But Bulgaria is in a really tough spot without Russian gas, they basically have no fast alternative (most of their Russian gas comes via TurkStream, a gaspipe that connects Russia to Turkey and then further to Bulgaria).

It is difficult getting around Russia's energy blackmail.

What mystifies me is why Europen nations never imagined they would find themselves in this position?

 

[Jack Fabulous]

Russia’s Gazprom Halts Gas Supplies to Poland, Bulgaria - The Moscow Times

Russia's energy giant Gazprom said Wednesday it had stopped all gas supplies to Poland and highly dependent Bulgaria after not receiving payment in rubles from the two EU members.

www.themoscowtimes.com

I have been forcasting for years that Moscow would someday use energy exports as a weapon for geopolitical blackmail. That someday is today.

Poland has a working LNG terminal. This places Bulgaria in a tough spot. Bulgaria has not transferred any of its considerable stocks of Soviet-era weaponry to Ukraine because the pro-Russia Bulgarian Socialist Party has objected. Beginning today, Bulgaria's PM and representatives of the other three major parties will be visiting Poland and then on to Kyiv to see Zelenskyy tomorrow. Bulgaria country is a big manufacturer of Soviet-era ammunition, anti-tank missiles, and light arms, and will debate the Ukraine issue again upon the return of the PM to Sofia.

Ukraine Braces For 'Much Pain' From Russia's Offensive In East As EU Responds To Gas Cut

Ukraine's defense minister says the country has "extremely difficult weeks" ahead, warning of major "destruction" in an ongoing large-scale Russian offensive in the east of the country.

www.rferl.org

The way I understand this is that Russia has insisted that gas purchases be made in rubles. I don't know all of the details about the process but I do know that Poland and Bulgaria refused to do so. Other European nations have until May 1 to make the change so by this coming Monday, the list may grow.

 

[joluoto]

It is difficult getting around Russia's energy blackmail.

What mystifies me is why Europen nations never imagined they would find themselves in this position?

Most just saw Russian gas as a cheap alternative, and why would there be problems, many Western countries started to buy gas from Russia already during the Soviet era, and if the Soviet Union didn't cause any troubles, and the gas trade survived the collapse of the USSR, most countries just didn't think Post- Soviet Russia would cause this kind of ruckus. Many of the modern deals are from the Yeltsin years and the early Putin years when Russia was seen as a country with some authoritarian flaws, but certainly on it's way to democratization.

 

[joluoto]

The way I understand this is that Russia has insisted that gas purchases be made in rubles. I don't know all of the details about the process but I do know that Poland and Bulgaria refused to do so. Other European nations have until May 1 to make the change so by this coming Monday, the list may grow.

Only Hungary is going to keep paying in Rubles, others have already paid in Dollars or Euros (depending on which currency the contracts states). Putin cherry picked Poland and Bulgaria for political reasons. Poland because they were already looking for ways to get rid of Russian gas and are one of the loudest anti- Putin voices in the EU and Bulgaria because he hoped this will put pressure on them to join Hungary in the Pro- Putin club, where Hungary sits alone. That might well completely backfire. When it comes to Germany for example I doubt Putin can afford to cut the gas, gas payments from the Germans is basically Gazprom's most important income.

 

[Rogue Valley]

Most just saw Russian gas as a cheap alternative, and why would there be problems, many Western countries started to buy gas from Russia already during the Soviet era, and if the Soviet Union didn't cause any troubles, and the gas trade survived the collapse of the USSR, most countries just didn't think Post- Soviet Russia would cause this kind of ruckus. Many of the modern deals are from the Yeltsin years and the early Putin years when Russia was seen as a country with some authoritarian flaws, but certainly on it's way to democratization.

Moscow's constant fights with Ukraine over gas transit fees should have been an indicator.

The underlying intent of NS-2 was to cut Ukraine out of the European supply loop, an economic weapon in its eight year war against Kyiv.

 

[Jack Fabulous]

Only Hungary is going to keep paying in Rubles, others have already paid in Dollars or Euros (depending on which currency the contracts states). Putin cherry picked Poland and Bulgaria for political reasons. Poland because they were already looking for ways to get rid of Russian gas and are one of the loudest anti- Putin voices in the EU and Bulgaria because he hoped this will put pressure on them to join Hungary in the Pro- Putin club, where Hungary sits alone. That might well completely backfire. When it comes to Germany for example I doubt Putin can afford to cut the gas, gas payments from the Germans is basically Gazprom's most important income.

Didn't Germany, Austria, and Italy already agree? Pretty sure they did...

 

[Rogue Valley]

Didn't Germany, Austria, and Italy already agree? Pretty sure they did...

Almost all gas delivery contracts with Russia specifiy that the payments must be made in either dollars or euros.

Demanding payment in rubles is, in effect, a breach of contract by Moscow.

Hungary is playing Moscow's game because Orban is Putin's boy within the EU.

 

[Jack Fabulous]

Almost all gas delivery contracts with Russia specifiy that the payments must be made in either dollars or euros.

Demanding payment in rubles is, in effect, a breach of contract by Moscow.

Hungary is playing Moscow's game because Orban is Putin's boy within the EU.

Admittedly, I am not completely up to speed with how these contracts are written. As I understand it, though, sanctioning the banks has taken away, or severely curtailed, Russia's ability to convert dollars and euros into rubles so Russia is insisting that payments be made in such a way so they CAN be. I'm pretty sure(not positive) that Germany and Austria have already agreed to do this.

 

[Rogue Valley]

Admittedly, I am not completely up to speed with how these contracts are written. As I understand it, though, sanctioning the banks has taken away, or severely curtailed, Russia's ability to convert dollars and euros into rubles so Russia is insisting that payments be made in such a way so they CAN be. I'm pretty sure(not positive) that Germany and Austria have already agreed to do this.

Power companies pay Russia for energy imports, not countries.

That said, any company doing this is in violation of EU sanctions and subject to penalties.

A simple solution is to remove Gazprombank from the SWIFT network.

 

[Jack Fabulous]

Power companies pay Russia for energy imports, not countries.

That said, any company doing this is in violation of EU sanctions and subject to penalties.

A simple solution is to remove Gazprombank from the SWIFT network.

Do you honestly believe that Russia will continue to provide gas and oil if they're not getting paid for it?

 

[Rogue Valley]

Do you honestly believe that Russia will continue to provide gas and oil if they're not getting paid for it?

Do you honestly think Russia can continue to function and also fund a large war without European gas purchases?

Moscow is already in sovereign bond default.

 

[Jack Fabulous]

Do you honestly think Russia can continue to function and also fund a large war without European gas purchases?

Moscow is already in sovereign bond default.

This isn't what I asked you. I asked you if you believed that Russia would continue to provide gas and oil if they're not getting paid for it?

Of course they rely on gas and oil to fund the war.

 

[Juin]

Do you honestly believe that Russia will continue to provide gas and oil if they're not getting paid for it?

You hit on the bottomline. Fact of the matter is sanctions have gone from a careful methodical process where you maximise damage on your adversary while minimising costs on you. Cooler heads like German Chancellor Olaf Scholz pointed this out but were drowned by the more hysterical Slavonic members of the EU.

At the beginning carefully thought out sanctions were proposed, but the more hysterical folks from Poland, the three Baltic midgets and others screamed for more. Some suggested that SWIFT was the nuclear option that would cripple Russia instantly. The hysterical crowd pounced on it. The more sober voices again asked: if you kick Russia out of SWIFT, and you still intend to buy Russian gas how do you intend to pay for it? Again those cooler heads were shouted down. It was much tougher for cooler heads in Germany, they were quickly intimidated to silence with dark rumours of Nazism.

The whole thing is silly because Russia proposed a workaround that even initial EU opinion suggested would not violate sanctions.

The Russians stipulated purchasers open two accounts with a Gazprom Bank. They will deposit their Euros into a first account. The Gazprom bank will convert the Euros to Roubles then deposit into the second account. The purchaser can then pay for the gas from the second account. An unnecessary windy process if you ask me, but it seems to me like a workaround that should satisfy both.

 

[Schrott]

Admittedly, I am not completely up to speed with how these contracts are written. As I understand it, though, sanctioning the banks has taken away, or severely curtailed, Russia's ability to convert dollars and euros into rubles so Russia is insisting that payments be made in such a way so they CAN be. I'm pretty sure(not positive) that Germany and Austria have already agreed to do this.

Nope, they have not.

 

[Schrott]

Do you honestly believe that Russia will continue to provide gas and oil if they're not getting paid for it?

They are getting paid for it, but not in Rubles. Can they afford to cut of Germany, Italy or France, I doubt that.
But then you never know, what Kim Putler will do.

Its not just gas, its oil, too. Germany for example has only one refinery left, which uses Russian oil and is at the present making a deal with Poland, to use its harbors, to supply that refinery with oil from other sources.
Russia is just a gas and oil station.

 

[Juin]

Do you honestly believe that Russia will continue to provide gas and oil if they're not getting paid for it?

They are getting paid for it, but not in Rubles.

And if the Russians keep complaining Germans should pay them in Marks. That should teach those pesky Russians not to question how they are paid

Russia is just a gas and oil station.

Fine. Just pay the man for his gas. It is normal for buyers to pay sellers in the manner the seller demands.

 

[Schrott]

And if the Russians keep complaining Germans should pay them in Marks. That should teach those pesky Russians not to question how they are paid






Fine. Just pay the man for his gas. It is normal for buyers to pay sellers in the manner the seller demands.

The contracts say Euros or Dollars, not Rubles, simple as that.

 

[Jack Fabulous]

They are getting paid for it, but not in Rubles. Can they afford to cut of Germany, Italy or France, I doubt that.
But then you never know, what Kim Putler will do.

Its not just gas, its oil, too. Germany for example has only one refinery left, which uses Russian oil and is at the present making a deal with Poland, to use its harbors, to supply that refinery with oil from other sources.
Russia is just a gas and oil station.

If they have no means to convert the euros or dollars into rubles because of sanctions, and they have no ability to use those euros or dollars because of sanctions, then they're not actually getting paid.

In what universe does it make sense for them to continue to provide gas and oil?

 

[Juin]

If they have no means to convert the euros or dollars into rubles because of sanctions, and they have no ability to use those euros or dollars because of sanctions, then they're not actually getting paid.

In what universe does it make sense for them to continue to provide gas and oil?

Exactly. The aim of the sanctions is to complicate, if not make impossible the use of Euro by Russia. To then turn around and insist on paying him in a currency whose use by him is difficult, is not paying him

 

[joluoto]

They are getting paid for it, but not in Rubles. Can they afford to cut of Germany, Italy or France,

They could probably afford cutting of France, the French aren't buying that much from them.