EU power ministers maintain disaster talks after Russian fuel cuts By Reuters

By Kate Abnett

BRUSSELS (Reuters) – Vitality ministers from European Union international locations maintain emergency talks on Monday, because the bloc strives for a united response to Moscow’s demand that European patrons pay for Russian fuel in roubles or face their provide being reduce off.

    Russia halted fuel provides to Bulgaria and Poland final week after they refused to fulfill its demand to successfully pay in roubles.

These international locations already deliberate to cease utilizing Russian fuel this yr and say they will address the stoppage, however it has raised fears that different EU international locations, together with Europe’s gas-reliant financial powerhouse Germany, might be subsequent.

It has additionally threatened to crack the EU’s united entrance towards Russia amid disagreement on the correct plan of action.

    With many European corporations dealing with fuel cost deadlines later this month, EU states have a urgent must make clear whether or not corporations can hold shopping for the gasoline with out breaching the EU’s sanctions towards Russia over its invasion of Ukraine.

Moscow has mentioned overseas fuel patrons should deposit euros or {dollars} into an account on the privately owned Russian financial institution Gazprombank, which might convert them into roubles. 

    The European Fee has instructed international locations that complying with Russia’s scheme may breach EU sanctions, whereas additionally suggesting international locations may make sanctions-compliant funds in the event that they declare the cost full as soon as it has been made in euros and earlier than its conversion into roubles. 

After Bulgaria, Denmark, Greece, Poland, Slovakia and others final week urged clearer recommendation, Brussels is drafting additional steering.

RUSSIA SAYS NO PROBLEM

Russia on Friday mentioned it noticed no downside with its decree, which considers the customer’s obligation fulfilled solely after the laborious foreign money has been transformed to roubles.   

    Whereas Bulgaria and Poland refused to have interaction with Moscow’s scheme, Germany has echoed the Fee’s workaround to permit corporations to pay, and Hungary has mentioned patrons can have interaction with Russia’s mechanism.

Funds in roubles may help to shelter Russia’s economic system from the affect of sanctions, whereas the gasoline revenues may help to finance what it calls a particular army operation.

EU international locations have paid greater than 45 billion euros ($47.43 billion) to Russia for fuel and oil because it invaded Ukraine on Feb. 24, analysis organisation the Centre for Analysis on Vitality and Clear Air discovered.

Russia provides 40% of EU fuel and 26% of its oil imports, a dependency which means Germany and others have thus far resisted requires an abrupt halt to Russian gasoline imports for worry of financial harm.

The EU is edging in direction of a ban on imports of Russian oil by the top of the yr, diplomats mentioned, after talks between the Fee and EU international locations on the weekend forward of conferences this week.

Ambassadors will talk about at a gathering on Wednesday a sixth package deal of EU sanctions towards Moscow being drafted by the Fee.

Ministers on Monday may also talk about the necessity to urgently safe non-Russian fuel provides and fill storage, as international locations brace for provide shocks. 

    Dependency on Russian fuel varies between international locations, however analysts have mentioned a right away whole cut-off of Russian fuel would plunge international locations, together with Germany, into recession and require emergency measures equivalent to manufacturing unit closures to manage.

    Austria, Hungary, Italy and Slovakia additionally had reservations over the weekend in regards to the concept of an oil embargo, diplomats mentioned.

    The Fee will later this month unveil plans to finish Europe’s dependency on Russian fossil fuels by 2027, together with by increasing renewable power and renovating buildings to devour much less.

($1 = 0.9488 euros)