BRUSSELS, April 27 (Reuters) - The EU's chief executive on Wednesday branded as "blackmail" Russian giant Gazprom's move to halt supplies to some European customers, but said the bloc was working on a coordinated response to Moscow's escalation.

Gazprom (GAZP.MM) said it had cut supplies to Poland and Bulgaria for failing to pay for gas in roubles, Moscow's toughest response yet to sanctions imposed by the West over the conflict in Ukraine. read more

"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," European Commission President Ursula von der Leyen said.

"This is unjustified and unacceptable. And it shows once again the unreliability of Russia as a gas supplier," she said in a statement.

Von der Leyen said the EU was prepared for this scenario, and would continue its work to ensure alternative supplies of gas and that gas storage is filled. EU rules require all countries to have a contingency plan to cope with a gas supply shock. EU gas storage is currently 32% full.

The EU was working on a coordinated response to Russia's escalation, von der Leyen said, and the bloc's "gas coordination group" of representatives from national governments and the gas industry was meeting on Wednesday morning.

Poland's climate ministry said on Tuesday its energy supplies were secure and there was no need to limit supply to consumers.

Brussels has sought a common response from EU countries to Russia's demand for rouble payments, after Moscow in March issued a decree proposing that energy buyers open accounts at Gazprombank to make payments in euros or dollars, which would then be converted to roubles.

The Commission has said companies should continue to pay the currency agreed in their contracts with Gazprom - 97% of which are in euros or dollars - and that paying in roubles could breach the EU's sanctions against Russia.

However, Brussels has said EU companies may be able to lawfully pay for gas under Russia's decree, for example, if companies can confirm that their contractual obligations are completed when they deposit euros with Gazprombank, as opposed to later, after Russia converted the payment into roubles.

Austrian Chancellor Karl Nehammer on Wednesday said Poland and Bulgaria had declined to use the payment system laid out in Russia's decree - of depositing euros through Gazprombank. read more

Analysts said the roubles payment issue risked splitting the bloc's united front against Russia over its invasion of Ukraine, if some countries were willing to pay roubles.

It was also not immediately clear if companies sending euros to Gazprombank, for conversion into roubles, had got confirmation that their deposit of euros would mark the completion of the transaction, as the EU had suggested they should.

"The EU needs collectively to refuse to play Russia's game," said Phuc-Vinh Nguyen, energy expert at the Jacques Delors Institute, adding that if one country sent roubles, others may follow, to attempt to avoid a gas supply cut-off.

"The biggest risk I see now is that of EU fragmentation, in case some buyers comply to Russia's request, while others do not," Simone Tagliapietra, senior researcher at Brussels-based think-tank Bruegel.

Nguyen said European countries should focus on urgent measures to curb gas use, such as by reducing heating and air conditioner use, to conserve supplies ahead of winter.

Lalasticlala, Mynd44
https://www.reuters.com/world/europe/eu-says-russian-gas-halt-is-attempt-use-fuel-blackmail-2022-04-27/

plaindealer, seems EU is wailing here

Blackmail?
Poland is whining like a child, after same Poland was complaining they want to end Russia gas importation and Russia did it for Poland without stress

They all want Russia cheap gas as Norway and Qatar are expensive X3 of what Russia gas price.

Why wailing, go and get your gas elsewhere, sebi Russia na your enemy? After all you all want to cripple them, you should have halted buying gas from them from the start of this war.
These oyinbos self are dumber than I thought,
Na USA wan push all na enter fire.

This should have been expected though. They are under sanctions, you want to keep paying in USD or Euro that they don’t have access to. And they are trying to boost their currency value… that’s a tit for tat where two people are playing the game. I don’t see no blackmails here, I see hypocrites here.

I would have expected the EU to leave some banks that’s facilitating their payment for gas out of the sanctions so Russia can have access to that, but you can’t block all their avenues and expect them not to react with though.

Been wondering why Canada is not yet selling its abundant oil and gas to EU during this period ? The Nigerian has too ?

sunboy:
This should have been expected though. They are under sanctions, you want to keep paying in USD or Euro that they don’t have access to. And they are trying to boost their currency value… that’s a tit for tat where two people are playing the game. I don’t see no blackmails here, I see hypocrites here.

I would have expected the EU to leave some banks that’s facilitating their payment for gas out of the sanctions so Russia can have access to that, but you can’t block all their avenues and expect them not to react with though.

Been wondering why Canada is not yet selling its abundant oil and gas to EU during this period ? The Nigerian has too ?

It doesn't make sense economically to import from Canada or Nigeria the whole volume Russia supplies them. First, I doubt both countries have the capacity. Secondly, it will make gas price x2 of Russian's price. The effect on European economy would be horrible. Asian giants would knock off your products from many markets with price .
Europeans can't do without Russian cheap gas

very dumb..I wonder how they colonised people

Puremaker8:
Why wailing, go and get your gas elsewhere, sebi Russia na your enemy? After all you all want to cripple them, you should have halted buying gas from them from the start of this war.
These oyinbos self are dumber than I thought,
Na USA wan push all na enter fire.

Jimasun:

It doesn't make sense economically to import from Canada or Nigeria the whole volume Russia supplies them. First, I doubt both countries have the capacity. Secondly, it will make gas price x2 of Russian's price. The effect on European economy would be horrible. Asian giants would knock off your products from many markets with price .
Europeans can't do without Russian cheap gas

I know it doesn’t make sense, cost and time benefits consideration. We really are not talking about what’s sensible now, we are talking about their survival without Russia. Cost don’t matter anymore when it’s about survival, Atleast for the short run.

The EU wants to have their cake and eat it too.
You sanction a country in order to devastate its economy in order to demonstrate that you are the big boy, thus Putin should fold his hands and do nothing.
Pay in Roubles for Gas or go somewhere else. Lobatan

sunboy:


I know it doesn’t make sense, cost and time benefits consideration. We really are not talking about what’s sensible now, we are talking about their survival without Russia. Cost don’t matter anymore when it’s about survival, Atleast for the short run.

Yes, I get your point sir.

No matter how this turns out, Russia have shot itself in the foot

It would have been their advantage is they are the only country that can supply gas

Better a costly gas than a cheap gas that can be used to blackmail you

With time, we will see how they are gonna replace EU market

Why wailing I thought Poland wanted to end gas supply Russia just make their wish come true

sapientia:
No matter how this turns out, Russia have shot itself in the foot

It would have been their advantage is they are the only country that can supply gas

Better a costly gas than a cheap gas that can be used to blackmail you

With time, we will see how they are gonna replace EU market

. Asia is about to destroy Asia economic

No mathematical how you hide the truth

You can’t change the fact, costs of production and life will sky rocket or in asia

sapientia:
No matter how this turns out, Russia have shot itself in the foot

It would have been their advantage is they are the only country that can supply gas

Better a costly gas than a cheap gas that can be used to blackmail you

With time, we will see how they are gonna replace EU market

EU will stop running into problems the moment they stop allowing US to dictate to them. Why would you strangle yourself just because US wants to use an opportunity to bring its enemy down.

Hanibbal:


EU will stop running into problems the moment they stop allowing US to dictate to them. Why would you strangle yourself just because US wants to use an opportunity to bring its enemy down.

Is it EU that invaded Ukraine?

Or you would have been happy if everyone left them to bear the aggression of an expansionist?

Russia is just shooting itself in the foot.They may be able to do a harm on EU now, but it will affect Russia in the long term.Once all this normalizes and alternitives are found, Russia will beg to sell its oil a dollar per barrel to EU.

sapientia:


Is it EU that invaded Ukraine?

Or you would have been happy if everyone left them to bear the aggression of an expansionist?

Well it's common sense. I can't constrict myself because of anyone. They've been seizing Russian assets and lobbying their companies that have supply chains in Russia to close up and end their services isn't that enough? must you strangle yourselves too when you know this gas is important for your economy to keep running.

" Working on Response "

So you guys thought the Russians would just sit there doing nothing when you are imposing sanctions on them ?

seunny4lif:
Blackmail?
Poland is whining like a child, after same Poland was complaining they want to end Russia gas importation and Russia did it for Poland without stress

They all want Russia cheap gas as Norway and Qatar are expensive X3 of what Russia gas price.

It's obvious Poland and much of the EU are ruled by incompetent shenanigans cum politicians. Calling this blackmail is utter nonesense and outrightly funny.

Heck, they are even threatening legal actions. because they understand the implications of paying in Rubles.

Here is the catch:

The Russian demand that EU pay in Rubles means the Russians can raise the exchange rate during the conversion process. This means, a friendly country like Hungary may pay for it's gas in Euro exchanged to Ruble charged at lesser exchange rate compared to Germany paying for the same gas in Euro converted to Ruble but at a higher exchange value. The EU guys understand this scheme hence their staunch refusal not to go with the scheme. But unfortunately, you can't replace Russian cheap energy for pure economic reasons. They have the option of paying Gazprom with Euros and then convert allow the company to do the conversion. But sadly, Russia still have them by the balls. Even if they deposit the funds in Euros into Gazprom account and leave Gazprom to do the conversion from Euro to Ruble itself, the Russian Central Bank could still raise the value of the Ruble and the EU country involved would have to pay for the shortage remaining by the time the conversion is done on the new Ruble value. So either way, they're screwed.

As for Poland, they simply do not have sufficient LNG terminals right now to stay fully independent away from Russian gas. They will do so eventually with the Norwegian pipe coming through Denmark, but the fact remains that for the time being, they will have to get their gas from wherever they seem fit at 3 times the price they usually pay for direct Russian gas. We know what that means for their industrial productivity and product price competitiveness in the open market. Things are already running high in the country and this recent Russian gas cut would only send inflation through the roof. No wonder they're threatening legal actions.