In what is believed to be a retaliatory move, Russia’s state-owned energy company Gazprom has cut its fuel supplies to Poland and Bulgaria. Both rely heavily on Russian gas. Bulgaria gets about 90% of its gas needs from Russia, while 50% of Poland’s gas supply comes from Russian gas exports.
This development sent shock waves to the market, with the price for natural gas futures rising by 23% as trading began on Wednesday morning.
Experts long predicted that the war would cause a severe disruption of Russian natural gas exports into the European Union and destabilize the market. Gazprom supplies Europe with about 40% of its gas.
The Russian energy giant’s move came just a few days after Poland, a significant gateway for delivering weapons to Ukraine, announced that it would be sending tanks to Ukrainian forces. Bulgaria has cut ties with Russia, and its regime currently supports the sanctions against Moscow.
European leaders are condemning the maneuver, calling it an effort by Russia to punish nations aiding Ukraine and use gas as leverage in the escalating economic war of sanctions being leveled against the country.
In a statement on Wednesday morning, Ursula von der Leyen, the president of the European Commission, reacted to the news.
“The announcement by Gazprom that it is unilaterally stopping delivery of gas to customers in Europe is yet another attempt by Russia to use gas as an instrument of blackmail,” she said.
Von der Leyen added that she was meeting with the commission’s gas coordination group to secure alternative gas supplies for affected member states.
The fair spring weather in Europe may soften the immediate blow of the gas cutoff, but the EU will quickly need to find alternative gas supplies. Failure to do so will undoubtedly result in gas prices rising significantly, pushing the already high inflation rates up and hurting consumers across Europe.
Bulgaria’s energy minister, Alexander Nikolov, said his country had enough gas to last for one month.
“Bulgaria will not negotiate under pressure and with its head bowed. Bulgaria does not give in and is not sold at any price at any trade counterparty,” Nikolov said. “Obviously, natural gas is used as a political and economic weapon.”
In a similar tone, Poland’s climate minister, Anna Moskwa, insisted that her country had been ready to be blocked from the Russian gas supply.
According to Russia, its decision to cease supplying Poland and Bulgaria’s gas was not a form of blackmail but rather “due to absence of payments in rubles.” Putin has been desperate to be paid in rubles because sanctions levied against the Russian Central Bank do not allow for the conversion of dollars or euros into the Russian currency.
However, one of Russia’s most influential lawmakers suggested Moscow could extend the cutoff.
“The same should be done with regard to other countries that are unfriendly to us,” said Vyacheslav Volodin, speaker of Russia’s lower house of parliament.
Meanwhile, the United States, which has long criticized the EU for its heavy reliance on Russian gas, has offered to provide more liquefied natural gas (LNG) to Europe. However, it cannot make up the entirety of the shortfall if Russia were to cut all gas exports.
