Russian gas supplies to Poland, Bulgaria halted - reports

Poland has repeatedly said it would not agree to Russia's demand to pay in roubles for gas it buys from Gazprom under new rules Moscow announced last month.

 The logo of Gazprom company is seen on the facade of a business centre in Saint Petersburg, Russia March 31, 2022. (photo credit: REUTERS/REUTERS PHOTOGRAPHER)
The logo of Gazprom company is seen on the facade of a business centre in Saint Petersburg, Russia March 31, 2022.
(photo credit: REUTERS/REUTERS PHOTOGRAPHER)

Russian gas supplies under the Yamal contract to Poland have been halted, Polish private broadcaster Polsat News and the Onet.pl website reported, citing unnamed sources.

PGNiG, which buys gas from Gazprom under a long-term contract that expires this year, said that it will take steps to reinstate the flow of gas according to the contract and that the halt of supplies was a breach of that contract. It further added that it has the right to pursue damages over breach of contract. 

Physical gas flows via the Yamal-Europe pipeline from Belarus to Poland were at zero kilowatt-hours (kWh) at 4 p.m. Central European Time (CET), down from 52,634,785 kWh/day in the early hours of Tuesday, data from the European Union network of gas transmission operators showed.

The Polish Climate Ministry said it would hold a briefing on gas supplies at 7:15 p.m. CET on Tuesday.

Poland has repeatedly said it would not agree to Russia's demand to pay in roubles for gas it buys from Gazprom under new rules Moscow announced last month.

 Russian Rouble coins are seen in front of displayed descending stock graph in this illustration taken, February 24, 2022. (credit: REUTERS/DADO RUVIC/ILLUSTRATION) Russian Rouble coins are seen in front of displayed descending stock graph in this illustration taken, February 24, 2022. (credit: REUTERS/DADO RUVIC/ILLUSTRATION)

Russia has warned Europe it risks having gas supplies cut unless it pays in roubles. In March it issued a decree proposing that energy buyers open accounts at Gazprombank to make payments in euros or dollars, which would then be converted to the Russian currency.

The European Commission said companies should continue to pay the currency agreed in their contracts with Gazprom - 97% of which are in euros or dollars.

Earlier Tuesday, Poland announced a list of 50 Russian oligarchs and companies, including Gazprom, that would be subject to sanctions under a law passed earlier this month allowing their assets to be frozen. The law is separate from sanctions imposed jointly by EU countries.

Gas cut to Bulgaria

Gazprom is also suspending gas shipments to Bulgaria, with Bulgaria's state-owned energy firm Bulgargaz notified that deliveries will be suspended as of April 27, independent Bulgarian news outlet the Sofia Globe reported, citing the Bulgarian Energy Ministry.

Bulgarian Energy Minister Alexander Nikolovi is expected to make a statement on the matter sometime Wednesday morning, the Sofia Globe reported, citing Bulgarian National Television.

Bulgaria also had a contract due to expire at the end of the year. It meets over 90% of its gas needs with Gazprom's imports at around 3 billion cubic meters (bcm) a year. 

Russia's new two-stage payment plan, which was made due to a desire to only be paid in roubles, posed a risk to Bulgaria since it was not in line with the ongoing agreement and meant that it was possible Sofia could make the payment but never receive gas supplies, Bulgaria's Energy Ministry claimed, according to the Sofia Globe.

"This is a seismic warning shot by Russia," according to Tom Marzec-Manser, head of gas analytics at data intelligence firm ICIS. 

"Poland has had an anti-Russia and anti-Gazprom stance for a number of years, which is not the case for Bulgaria, so to see Bulgaria also be cut off is also quite a development in its own right," he said.

Bulgaria said it has taken steps to find an alternative gas supply and no restrictions on gas consumption are being instituted for now.