Russia Halting Gas Flows to Poland, Bulgaria Over Payment Terms
Starting Wednesday, Russia has announced that it will halt gas flows to Poland and Bulgaria, marking the first time the country has followed through on a threat to cut off countries that don’t pay for their gas on Russia’s terms. In March, Vladimir Putin outlined new terms of payment that correspond with wartime measures. This is a major escalation on behalf of Russia, which has tried to bolster its currency by insisting that gas be paid for in rubles. The move also increases the likelihood that other European countries that depend deeply on Russian gas could be targeted. Following the announcement, gas prices in Europe rose by more than 10% as of late Tuesday.
The gas is typically sent to Poland and Bulgaria via the 2,500 mile Yamal pipeline, and both countries receive gas from Russia’s state-owned company, Gazprom PJSC. Poland reportedly received a letter stating that it is obliged to pay for gas supplies in accordance with the new wartime procedures, and Bulgaria received a similar note. However, Bulgaria claims that it has already fulfilled its obligations under its current contract with Gazprom. The decision will not deeply effect Poland, who was already on track to become independent of Russian gas by the end of this year. In Bulgaria, this is not the case as the country gets more than 75% of its gas from Russia.