While the European Union has postponed any possibility of a Russian gas embargo in the longer term, it may need to do so sooner than it thinks. After Poland and Bulgaria, it’s the turn from the Netherlands and Bulgaria to be cut off from Russian exports. Gazprom announced this week that it had ceased supply, with the two states refusing to pay it in rubles, as the Kremlin now demands.
As a result, Russian gas exports fell by 27.6% between January and May 2022 compared to the same period in 2021. “Exports to distant foreign countries (excluding CIS countries, ed. *) Amounted to 61 billion cubic meters, or 27.6% (23.2 billion cubic meters) less than for the same period of 2021 ”Gazprom told Telegram on Wednesday that it was delivering gas.in accordance with confirmed orders “. The Russian giant also stated that “Gas exports to China through Power of Siberia pipeline increase under long-term contract between Gazprom and CNPC. In other words, the drop in deliveries is mainly due to the European Union.
In addition, Gazprom said in a statement that gas reserves at European underground storage facilities were 20.4 billion cubic meters of gas. In addition, Russian gas supplies through Ukraine fell after Russian forces entered gas facilities in the Lugansk region. «To meet the EU’s 90% target for storage facilities, companies will have to pump an additional 42 billion cubic meters of gas. “the group said.
The EU is dependent on 40% of Russian gas exports
As a reminder, Russian gas accounts for 40% of EU imports in this area, or 150 billion m3 per year. It is therefore difficult for the Twenty-Seven to make a cross on this energy manna, fearing shortages for next winter. This is especially true for Germany, which is largely dependent on Moscow for its gas. Most of its gas supply via pipelines comes mainly from Russia, which accounts for more than half of its imports and 50% of homes are heated by gas. In mid-April, five German polling institutes were warning in concert on the risks of a recession for the country if it cut off its energy supplies from Russia, including gas.
Especially since the EU has finally agreed, after a month of negotiations, to agree on an embargo on Russian oil with a few concessions, however, to Hungary in particular. A few weeks earlier, member states had also decided on an embargo on Russian coal that would take effect in early August. It is therefore difficult for the Twenty-Seven to cut itself off in the immediate future of a new energy resource, the time to find a solution to make up for the Russian absence, like Germany, which is turning to Africa in particular. Berlin has committed itself to Senegal in renewable energy projects or energy storage, and has begun talks on gas, Chancellor Olaf Scholz said on May 22.
* The Commonwealth of Independent States (CIS) was established in December 1991 by eleven countries of the former USSR: Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Uzbekistan, Russia, Tajikistan, Turkmenistan, Ukraine. It was joined in December 1993 by Georgia. Only the Baltic states, also former Soviet republics, have not joined the CIS but are members of the EU.
Russia is taking steps to “minimize” the impact of the embargo on its oil
This is a sanction that could have serious consequences for Moscow. On Monday night, the Twenty-Seven finally managed to agree on an embargo on Russian oil, but granted some exemptions to Hungary in particular. The European Union will therefore drastically reduce its imports by the end of the year, hoping to deprive Russia of a significant source of revenue to finance its offensive in Ukraine.
But the Kremlin was confident this Wednesday in its ability to “minimize” the impact of this new measure decided by the Member States as part of a sixth package of sanctions against Moscow. “These sanctions will have a negative impact on Europe, on us and on the world energy market as a whole. But there is a reorientation (of the Russian economy) that will allow us to minimize the negative consequences.”Russian presidential spokesman Dmitry Peskov told reporters.
Russia has so far relativized the scope of economic sanctions taken by Western countries since the beginning of Ukraine’s intervention in Ukraine. Especially since Moscow can still count on its gas manna, on which Europeans are dependent. However, the effects of the sanctions are beginning to be felt, including an acceleration in inflation, and many economists believe that the situation will worsen in the coming months.