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Russia's Gazprom exits German energy market amid row over gas payments

Friday, 01 April 2022 4:50 PM [ Last Update: Friday, 01 April 2022 4:50 PM ]

The logo of Gazprom is pictured at the 26th World Gas Conference in Paris, France, June 2, 2015. (Photo by Reuters)

Russia’s energy giant Gazprom says it is quitting its business in Germany, as Moscow’s deadline passes for a switch in gas payments from euro to rubles.

The company said on Friday that it had terminated its participation in Gazprom Germania GMBH and all of its assets, including Gazprom Marketing & Trading Ltd.

The development comes as the German economy ministry has threatened to expropriate the Gazprom and Rosneft units in the country amid concerns about the security of energy supplies.

The Kremlin was quick to hit back, saying that any such move is a violation of international law.

Meanwhile, Berlin announced on Thursday that it is preparing for a gas supply emergency in case of a possible disruption to natural gas flows from Russia.

A growing number of German companies are also planning to raise their prices over the next three months.

Putin: Russia to halt gas flow to Europe if payment conditions not met

President Vladimir Putin says Russia will halt gas contracts if foreign buyers do not pay in rubles.

The energy crisis was intensified after Russian President Vladimir Putin signed a decree to impose ruble pricing for gas on buyers from unfriendly countries, including the EU, as of April 1st.

Putin said on Thursday that Russia will halt its gas contracts with European buyers if they do not pay in rubles.

In televised remarks, Putin said that “if such payments are not made, we will consider this a default on the part of buyers, with all the ensuing consequences. Nobody sells us anything for free, and we are not going to do charity either - that is, existing contracts will be stopped.”

Germany, which depends on Russian gas for about 40 percent of its needs, rejected the request, with its Economy Minister Robert Habeck saying that Berlin would not be “blackmailed by Putin”. However, the German government later said it was examining the decree to determine its specific impact.

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