[Brussels, 24th Archyde.com]-Russian President Vladimir Putin demanded that “unfriendly countries” pay for natural gas in rubles, European Union (EU) leaders signed a supply contract on the 24th. He pointed out that there was a risk of violation.
In response to Mr Putin’s remarks, European natural gas prices have skyrocketed. Concerns have grown over the supply of regarding 40% of natural gas to the EU, which is procured from Russia.
Germany and Italy have stated that Russia’s actions might violate energy supply contracts. German Prime Minister Schortz said that the currencies that German companies have to pay for Russian fossil fuels are fixed in contracts, saying, “There are fixed contracts everywhere, and the currency of payments is in these contracts. It’s partly included. In most cases it’s a euro or a dollar. ” Italy’s Prime Minister Mario Draghi also emphasized that “it is basically a breach of contract and it is important to understand this.”
Meanwhile, the German industry group, the Federation of Energy and Water Business Associations (BDEW), has called on the government to introduce an early warning system in case Russia shuts down its gas supply.
He also called on the Federal Network Agency (BNetzA), an energy regulator, to formulate existing regulations that guarantee household gas supply but require standards for continued gas supply to businesses.
However, Habeck’s economic minister pointed out that an early warning system is not necessary and supply is guaranteed. He also expressed the idea of watching the situation carefully.
The White House said it is consulting with its allies when asked if it would allow European countries, which would not be able to supply gas if it might not be procured from Russia, to pay in rubles without violating sanctions. ..
European Commission President Von der Leyen agrees with the ideas of Germany and Italy. Russia’s move is to circumvent EU sanctions, saying, “We do not tolerate sanctions evasion. The days when energy is used to intimidate us are over.”
Gazprom, Russia’s leading gas exporter, has more than 40 long-term gas contracts with European clients, and Europe pays Russia hundreds of millions of euros a day for fossil fuels.
According to Gazprom, as of January 27, regarding 97% of gas sales to Europe and elsewhere have been settled in euros or US dollars.
Slovenian Prime Minister Janez Janša emphasized that Europe will not pay Russia in rubles. “I don’t think anyone in Europe knows what a ruble looks like, and no one will pay for it,” he said.
Energy giant Uniper and electricity giant RWE, which buy the most gas from Gazprom in Germany, declined to comment.
