Poland, Bulgaria say Russia suspending natural gas supplies

Associated Press

11:35 JST, April 27, 2022

WARSAW (AP) — Polish and Bulgarian officials said Tuesday that Moscow is cutting off natural gas deliveries to their countries due to their refusal to pay in Russian rubles, a demand made by President Vladimir Putin after sanctions were levied against his nation over the invasion of Ukraine.

Russian state-owned energy giant Gazprom informed the two EU and NATO member nations that gas supplies will be suspended starting Wednesday, their governments said.

The suspensions would be the first since Putin’s announcement last month that “unfriendly foreign buyers” would have to transact with Gazprom in rubles instead of dollars and euros. Only Hungary has agreed to do so, with other countries rejecting the demand as an unacceptable, one-sided breach of contracts and a violation of sanctions.

If deliveries are halted to other countries as well, it could cause economic pain in Europe, driving natural gas prices up and possibly leading to rationing — but it would also deal a blow to Russia’s own economy.

Wednesday’s cutoffs will affect deliveries of Russian gas to Poland through the Yamal-Europe pipeline, according to Polish state gas company PGNiG, and to Bulgaria via the TurkStream pipeline, that country’s Energy Ministry aaid.

The Yamal-Europe line carries gas from Russia to Poland and Germany, via Belarus. Poland has been receiving some 9 billion cubic meters annually, fulfilling some 45% of the country’s need.

PGNiG said it was considering legal action over Moscow’s payment demand.

But Climate Minister Anna Moskwa said Poland is prepared to make do after having worked to reduce its reliance on Russian energy sources. Several years ago the country opened its first terminal for liquefied natural gas, or LNG, in Swinoujscie, on the Baltic Sea coast, and later this year a pipeline from Norway is to become operational.

“There will be no shortage of gas in Polish homes,” Moskwa tweeted.

Analyst Emily McClain of Rystad Energy concurred, saying that Poland has ample natural gas in storage and has the capacity to ramp up imports.

Bulgaria said it was working with state gas companies to find alternative sources and that no restrictions on domestic consumption would be imposed for now, even though the Balkan country of 6.5 million people meets over 90% of its gas needs with Russian imports.

One feasible and relatively immediate option available to the Bulgarian government would be to increase their imports of Azeri gas.

Poland has been a strong supporter of neighboring Ukraine during the Russian invasion and has acted as a transit point for weapons the United States and other Western nations have provided to Kyiv.

Warsaw said this week that it, too, was sending weaponry to Ukraine’s army, in the form of tanks. On Tuesday it announced sanctions targeting 50 Russian oligarchs and companies, including Gazprom.

Bulgaria, once one of Moscow’s closest allies, has cut many of its ties with Russia after a new, liberal government took the reins last fall and also in the wake of the invasion. It has supported sanctions against Russia and sent humanitarian aid to Ukraine.

Bulgaria has been hesitant to provide military aid, but Prime Minister Kiril Petkov and members of his coalition government were expected in Kyiv on Wednesday for talks about further assistance.

Europe buys large amounts of Russian natural gas for residential heating, electrical generation and the fuel industry, with Germany particularly dependent on it. The imports have continued despite the war.

Around 60% of imports are paid in euros, and the rest in dollars. Putin’s demand was apparently intended to help bolster the Russian currency against Western sanctions.

In Washington, White House press secretary Jen Psaki said the U.S. had been preparing for such a cutoff by Russia.

“Some of that has been asking some countries in Asia who have excess supply to provide that to Europe,” Psaki said. “We’ve done that in some cases, and it’s been an ongoing effort.”