Tag Archives: Gazprom

Russia using gas to bully Moldova, says EU

By Robin Emmott

BRUSSELS (Reuters) -The European Union’s top diplomat said on Thursday that Moscow was using natural gas to bully Moldova, as the prime minister of the ex-Soviet republic said the country could not afford the prices Russia was now offering.

Moldova’s gas contract with Russia’s Gazprom expired at the end of September. Moldova’s pro-EU Prime Minister Natalia Gavrilita told Reuters that Gazprom was not offering the new government the traditional annual rollover of a previous, 30-year contract, but instead a three-fold price increase.

The Kremlin on Wednesday denied the Russian company was using gas talks to try to extract political concessions, but EU foreign policy chief Josep Borrell rejected that argument.

“In global terms the price increases around the world are not a consequence of weaponization of the gas supply, but in the case of Moldova, yes it is,” Borrell told a news conference alongside Gavrilita in Brussels.

He did not offer any detailed evidence of Russian pressure. Gavrilita said in an interview with Reuters that Gazprom had increased its long-standing price for Moldova to $790 per 1,000 cubic meters of gas, from around $250.

“The price increase for Moldova is just extraordinarily stark. It has increased threefold and is set to increase fourfold if we buy everything on the spot market. The country cannot afford this politically, economically or socially,” Gavrilita said.

Moldova is governed by the pro-Western government of President Maia Sandu who defeated Moscow-backed Igor Dodon in an election last November. The country was one of the Soviet Union’s 15 republics and has been at the center of a political tug of influence between Russia and the West since the 1991 collapse of the Soviet Union.

Gavrilita said Moldovan officials continued talks with Gazprom in St. Petersburg and that she took it as a good sign that they were continuing, but it was still unclear if there would be a deal.

She said the country was looking at swaps, contracts without prepayment conditions and long-term contracts from other sources. The country bought gas from EU countries for the first time this month.

EU HOPES, BUT NOT NATO

Asked if Moldova could live without a long-term Gazprom contract, she said: “I want to underline here that no European country is buying its whole supply on the spot (market).”

Gazprom has said it will suspend gas exports to Moldova, which borders Romania and Ukraine, if it is not paid for previous supplies.

The EU this week said it would give Moldova 60 million euros ($70 million) by the end of the year to deal with the crisis, after Moldova declared a state of emergency.

Gavrilita, who said supplies had fallen so low that pressure in Moldovan pipelines went below a critical level, will use the money to help poor Moldovans unable to pay higher energy prices.

After less than 100 days in office, the Sandu government is looking to end years of endemic corruption and is “looking for a European style of development,” Gavrilita said. “In the long term, yes, we do see Moldova as part of the EU,” she said, adding that the country was not seeking to join NATO.

(Reporting by Robin Emmott; Editing by Jan Harvey and Susan Fenton)

U.S. lawmakers ask Blinken for briefing on Nord Stream 2 natgas pipeline

By Timothy Gardner

WASHINGTON (Reuters) – Several U.S. Representatives on Wednesday raised pressure on the State Department to share plans on potential sanctions on the Nord Stream 2 natural gas pipeline Russia is racing to finish to take fuel to Europe.

“If completed, Nord Stream 2 would enable the Putin regime to further weaponize Russia’s energy resources to exert political pressure throughout Europe,” two Republicans including Michael McCaul, and two Democrats including Marcy Kaptur, wrote in a letter to Secretary of State Antony Blinken.

U.S. representatives and senators have said that the Biden administration has missed a deadline of Feb. 16 to issue Congress a report required by recently passed law on companies helping Russia’s state energy company Gazprom lay pipeline, insure vessels, and certify construction work.

Several companies, including Zurich Insurance Group have already left fearing sanctions and companies listed in report could drop out of the project, making completion difficult.

Nord Stream 2 is more than 90% complete but requires additional tricky work in deep waters of the Baltic Sea off Denmark. The pipeline would bypass Ukraine, through which Russia has sent gas to Europe for decades, depriving it of lucrative transit fees and potentially undermining its struggle against Russian aggression.

The representatives asked Blinken for a briefing with State Department officials to inform them of the status of the report and their assessment of possible sanctionable activity of vessels believed to be helping to finish the project.

President Joe Biden believes the $11 billion pipeline, which would double the existing capacity of the Nord Stream system to take gas undersea to Germany, is a “bad deal for Europe” according to his press secretary Jen Psaki.

State Department spokesman Ned Price told reporters last week that “sanctions are only one” of many tools and that the department will work closely with allies and partners to reinforce European energy security and to safeguard against “predatory behavior”. The department did not immediately respond to a request about the requested briefing.

The representatives said the briefing should include details on “any proposals offered to the Biden administration on the future of the pipeline that aim to persuade the administration to forego or weaken the mandatory sanctions,” apparently referring to any talks between Washington and Germany for a deal on the project.

Gazprom insists the project will be completed in 2021.

(Reporting by Timothy Gardner; Editing by Marguerita Choy)