EU predicts a break in Russian gas supplies

The Russian demand to receive payments in rubles is a “unilateral and unjustified modification of contracts”, insisted the European Commissioner for Energy: “We must prepare for a suspension of supply”.

The European Union (EU) will not pay for its gas purchases from Russia in rubles, and therefore must prepare for a supply break, admitted a high-ranking source from the European Commission, at the end of a meeting of energy ministers.

The European Commissioner for Energy, Kadri Simson, said that the Russian demand to receive payments in rubles is a “unilateral and unjustified modification of the contracts, and therefore it is legitimate to reject it.”

According to Simson, approximately 97% of the contracts signed by European companies for the purchase of Russian gas and specifying the currency of payment refer to the euro or the US dollar.

Simson said that the payments due in mid-May will be made “with respect to the contracts.” So “we need to prepare for a supply shutdown,” Simson warned.

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This was the first meeting of European energy ministers after Russia cut off gas supplies to Poland and Bulgaria because those two countries refused to pay in rubles for their liquefied gas imports.

At the end of the meeting, Simson pointed out that the European Commission communicated to the bloc’s countries its conviction that paying for Russian gas purchases in rubles represents a break with the sanctions adopted by the EU against Russia.

However, he added that at the request of the ministers themselves at the meeting this Monday (2.05.2022) the Commission “will provide a more detailed guide on what companies can and cannot do within the framework of sanctions.”

The issue has become a huge headache for the EU: practically 40% of the liquefied gas used by European industry comes from Russia.

The possibility of Russia cutting off gas supplies to countries that refuse to pay in rubles is flashing warning lights, and to avoid such a scenario, countries in the bloc are seeking clarification on their options.

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