Russia to Cut Gas Until Pay Demands Met
European gas prices have risen by more than 20% as Russia uses its vast energy resources as a weapon against Ukraine’s European allies.
Moscow is following through on a threat to cut off gas supplies to countries that refuse President Vladimir Putin’s new demand for payment in rubles. The question now is which countries will be targeted next, as the speaker of the Duma has called for other “unfriendly” states to be cut off as well.
Russia’s Gazprom PJSC said it has halted gas supplies to Poland and Bulgaria and will continue to do so until the two countries agree to pay for the fuel in rubles, as demanded by Moscow.
“We should do the same with other countries that are hostile to us,” Vyacheslav Volodin wrote on Telegram.
In principle, the European Union has rejected paying in rubles, claiming that it violates sanctions and strengthens Russia’s hand. But, as payment deadlines approach, governments across Europe must decide whether to stick to their guns and risk energy rationing, or to cave in to Putin’s demands.
There has been no official reaction from major European capitals, though European Commission President Ursula von der Leyen has stated that the EU’s gas coordination group will meet on Wednesday to plan a coordinated response to Russia’s “blackmail.”
Last week, the EU appeared to hint at a possible compromise solution that would allow the gas to continue flowing. However, the move against bloc members Poland and Bulgaria is likely to make a solution more difficult to achieve. Germany is heavily reliant on Russian gas and has threatened to ration fuel if supplies are cut off.
Putin’s gambit also removes the option of sanctioning Russian gas from the EU’s potential toolkit. On Wednesday, European ambassadors will meet, and options for an oil ban are expected to be discussed.
Putin stated that switching to rubles would help protect Russia’s massive gas revenues from EU sanctions or seizure.
The move also appeared to be aimed at ensuring that Gazprombank, one of the few large state banks spared the harshest sanctions, would be largely unaffected.
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