Russia Cuts Oil Deliveries to the Ukraine

Ken Hanly writes:  Russian president Vladimir Putin has ordered Gazprom to cut supplies to and through the Ukraine by 60 percent. He accuses the Ukraine of siphoning off supplies for Europe and stealing Russian gas.

Russia  claims that due to “transit risks for European consumers in the territory of the Ukraine” the supply cuts had to be made. As a result of the move Gazprom gas supplies to Europe plunged by 60 percent. Ukraine reportedthat Russia had shut off the gas supply. A total of six countries reported a complete shut off of Russian supplied gas.

Bulgaria, Greece, Macedonia, Romania, and Turkey  there had been a stop to gas shipments from Russia coming through the Ukraine. Croatia said that it had to reduce supplies to industrial customers. Bulgaria claimed that it was in a crisis situation and had gas for only a few days. The EUimmediately issued a statement condemning the cut off: ‘Without prior warning and in clear contradiction with the reassurances given by the highest Russian and Ukrainian authorities to the European Union, gas supplies to some EU member states have been substantially cut.’ The statement went on to demand that the gas supplies be restored immediately and that Russia and the Ukraine negotiate an end to their commercial dispute, which is the root cause of the situation.

The head of Gazprom  said that Russia plans to shift all natural gas flows now crossing the Ukraine to an alternative route through Turkey. About 40 percent of present Russian gas shipments to Europe pass through the Soviet area link via the Ukraine. Originally Russia planned a link through Bulgaria but dropped the plan after EU opposition. Bulgaria is now being made to suffer as no supplies at all from Russia enter the country. Russia supplies about 30 percent of EU natural gas.

Gazprom’s viewpoint appears to be that the EU will be the one to deal with that problem as it will simply deliver gas to the border of Greece and it will be up to the EU how gas is delivered from that point.
Russia may be using its plans as a bargaining chip but the EU is itself planning an energy union to reduce dependence on Russian gas and hence it may make sense for Russia to itself reduce reliance on the Ukrainian transit system, especially given the political conflict with the Ukraine.
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