Europe always in trouble because of Russian pressure on gas payments. According to reports in the Financial Times, some of Europe’s largest energy companies are preparing to use a new payment system in rubles that risks weakening EU sanctions and the unity of the European bloc by pouring billions of euros into Fly’s economy .
The strategy of the big energy companies
Some gas operators in Germany, Austria, Hungary and Slovakia are reportedly planning to open ruble accounts with Gazprombank in Switzerland. Among them, the newspaper names Uniper in Düsseldorf and OMV in Vienna. Payments are possible for both companies with the new system and do not violate the sanctions imposed by Europe. According to Bloomberg, citing a source close to Gazprom, four European gas buyers paid in rubles and opened ten accounts with Gazprombank. The double-counting strategy, for which Eni is evaluating the option for Italy, aims to guarantee the payments requested by Moscow in the currency of the federation by procuring the necessary supplies at the same time. A basic today that gas is worth its weight in gold. The price of European gas marks an increase of more than 4% to 107 euros per megawatt hour.
The call for European unity
Valdis Dombrovskis, Executive Vice-President of the European Commission, stressed that it is up to the individual companies that have signed contracts with Gazprom to interpret them. But he urged them to respect what the documents say: prices are agreed in euros or dollars. So you pay a certain amount of euros for a certain amount of petrol, that’s the end of the story. He stressed the wrongness of Russia’s actions, adding: It is important to preserve EU unity in this regard, as President von der Leyen said, we should not give in to this kind of blackmail.
The Italian Ministers
A position also shared by Foreign Minister Di Maio, who said yesterday: “Our contracts provide for payment in euros and we want to pay in euros”, stressing that a European decision is needed. Public Administration Minister Renato Brunetta is more cautious: there is still a lot of confusion both on the Russian side and on the buyer side, I think we can find a solution that is bank-like and compatible with sanctions, I think that itself common sense can prevail, also in view of the autonomy of the EU.
Russia and sanctions
On the other side of the fence, Russia is fighting Western sanctions imposed after the invasion of Ukraine began. Gazprom yesterday halted gas supplies to Poland and Bulgaria due to payment problems with Europe trying to rid itself of Russian energy. The company expects gas production to fall by around 4%. This was announced by Deputy Director General Vitaly Markelov, thereby confirming the impact of sanctions on Russia. Markelov said the group expects production to fall to 494.4 billion cubic meters from last year’s 514.8 billion. This is Gazprom’s lowest production since 2017.