Russia cuts off gas to Netherlands and Denmark for refusing to pay in roubles

Russia continues to stick to its policy: if you don't pay in roubles, you don't supply gas to Europe. However, this condition is not being accepted by all countries. Finland, Poland and Bulgaria have already refused, and now it is the Netherlands and Denmark that have joined the refusal to pay for gas in Russian currency, a decision that has led the Russian gas company Gazprom to cut gas supplies to these two countries.

The Dutch company GasTerra said deliveries would stop on Tuesday, when Gazprom confirmed the cut-off. "GasTerra will not accept Grazprom's demands for payment. This is because to do so would risk breaching sanctions imposed by the European Union and also because there are too many financial and operational risks associated with the required payment route," the company said in an official statement. 

This interruption of supplies to GasTerra means that some 2 billion cubic metres of gas will not be delivered from the time supplies are shut off until 1 October, when the Dutch company's contract with Gazprom expires. Meanwhile, GasTerra has announced that they can cover this lack of supply with other alternatives because "the European gas market is highly integrated and extensive", although there is some uncertainty for the winter: "It is impossible to predict how the loss of supply of 2 billion cubic metres of Russian gas will affect the supply and demand situation and whether the European market can absorb this loss of supply without serious consequences".

For its part, Denmark's Orsted said it was preparing for a cut because the company has also refused to budge on Putin's terms. However, the company has indicated that Russia will not be able to cut off supplies directly, as there is no pipeline from Russia to Denmark, and will have to do so via Germany. According to a statement from Orsted, "this means that Denmark will have to buy more from the European gas market".

However, Europe remains divided over how to handle Moscow's conditions and whether to deal with non-compliance with EU sanctions. Hungary stood firm on its decision to pay for gas supplies in roubles in order not to cut off supplies, and because "there seemed no need for the European Commission's willingness to have a common response" on gas, as Hungarian Foreign Minister Peter Szijjarto claimed.

Now the EU member states are meeting in Brussels to seek an agreement to unblock this sixth package of sanctions aimed at vetoing Russian oil, although it maintains some "temporary exceptions" to ensure the supply of fuel to the most dependent member states through the Druzhba pipeline. This means exempting Hungary, Slovakia and the Czech Republic from the embargo indefinitely.

This agreement, which could reduce purchases by up to 90% this year, is viewed with some scepticism due to the inability of EU members to agree on restrictions on Russian oil, which suggests that there will be a lack of agreement when it comes to vetoing Russian gas as well.

In any case, the message from the main representatives of the EU-27 has been to continue moving forward with sanctions against Russia in order to help Ukraine. "We cannot stop Russia from selling oil to someone else. We are not that powerful. But we are Russia's most important customer. They will have to look for others and obviously they will have to reduce the price. The aim is that the Russians will have less financial resources to feed the war machine,' said EU High Representative for Foreign Affairs Josep Borrell.

In contrast, Hungary continues to consider the agreement insufficient. Hungarian Prime Minister Viktor Orban said that the deal does not offer sufficient guarantees that his country will be assured of supplies in case something goes wrong with the sanctions-free pipeline. "We need guarantees that in case of an accident on the Russian pipeline through Ukraine we will have the right to get Russian oil in other ways. If we have it, it will be fine," Orban said. The populist leader also called for "solutions before sanctions" and blamed Brussels for the lack of agreement.