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Netherlands and Denmark to stop taking gas from Russia

The Dutch gas company GasTerra will stop taking gas from the Russian gas company Gazprom. Supply interruptions are also expected in Denmark.

GasTerra, which buys and trades gas on behalf of the Dutch government, has announced the end of trading with Gazprom because it refuses to pay for gas in rubles.

GasTerra’s contract with Gazprom is valid until September 30. Gazprom was due to deliver 2 billion cubic meters of gas to the Netherlands by then. GasTerra added that it does not expect a supply cut as it has already contracted gas elsewhere.

Read also: Inflation in the euro area rose again in May

Dutch Energy Minister Rob Jetten assured on Twitter that the decision would have no impact on physical gas supplies to Dutch households.

GasTerra said in a statement that it had decided not to accept the payment system demanded by Russia. It believes that doing so could violate European Union sanctions. It said the payment method posed many financial and operational risks.

Gas burner flame with Russian flag on black

Denmark’s Orsted is in the same position

Denmark’s largest energy company, Orsted, has also warned that Gazprom is likely to cut off its supplies because it has refused to pay in rubles. However, the stoppage of gas from Russia should not pose an immediate threat to Denmark’s gas supply and the Danish Energy Agency has a plan in place in case of a gas shortage. Orsted expects to be able to buy gas on the European market.

There is no pipeline directly from Russia to Denmark, which means that Moscow will not be able to stop supplies to the country directly. Orsted has previously said that its contract with Gazprom covers the vast majority of Denmark’s gas consumption and accounts for about 1.5% of total Russian gas supplies to Europe, which amounted to about 155 billion cubic meters last year.

Orsted already sold its oil and gas assets in 2017 to focus on offshore wind power. But it retained a long-term gas supply contract with Gazprom that runs until 2030.

Europe is not united on the issue

Russia has previously cut off gas supplies to Poland and Bulgaria. Subsequently, following the announcement of a possible entry into NATO and a swing from neutrality to the European side, gas supplies were also cut to Finland. In contrast, companies from Germany, Italy and France have said they will accept Russian demands and engage in a Ruble payment system to maintain their gas supplies.

Bruno is an Investment enthusiast with several years of experience in the industry. He enjoys following the latest news and technology trends...


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