EU readies to end Russian gas, won’t pay in roubles
BRUSSELS: The European Union warned member states on Monday to prepare for a possible complete breakdown in gas supplies from Russia, insisting it would not cede to Moscow’s demand that imports be paid for in roubles.
The European Commission was to propose to member states a new package of sanctions to punish President Vladimir Putin’s Kremlin for its invasion of Ukraine, including an embargo on Russian oil yesterday, officials said.
But energy and environment ministers meeting in Brussels on Monday addressed the larger and potentially more complicated issue of Russia’s natural gas, upon which several countries — including EU top economy Germany — depend for much of their power generation.
Moscow has demanded clients from “unfriendly countries” — including EU member states — pay for gas in roubles, a way to sidestep Western financial sanctions against its central bank. It has cut off Bulgaria and Poland after their firms refused to comply.
After the talks, the French chair of the meeting, ecological transition minister Barbara Pompili, and the European commissioner for energy, Kadri Simson, said the 27 member states were united with Poland and Bulgaria and would stockpile gas to be prepare for a breakdown.
Ms Simson said that “following the full procedure as set out by Russia constitutes a breach of sanctions” imposed by the European Union. She said that, to her knowledge, no European company was preparing to follow Mr Putin’s decree and change its payment methods.
But several countries are to renew supply contracts at the end of May, and reports suggest some could seek to work around the sanctions by following the method put forward by Moscow.
This would entail a firm opening two accounts in Russian state energy giant Gazprom’s bank.
Payments would be deposited in one account in euros or dollars, then be passed through the sanctioned Russian central bank, before arriving in the second account in roubles.
Ms Kadri and some ministers seemed to say that this would still constitute a sanctions breach. But other member states demanded further clarification from the European Commission’s experts.