FSUOGM: Gazprom slashes gas supply to Europe by over a quarter YTD

Russia’s Gazprom has slashed gas supplies to Europe by more than a quarter this year, the company reported on May 16, despite a bump in its production over the same period.

The state gas supplier’s exports to the so-called Far Abroad, referring to Europe plus Turkey, minus countries of the former Soviet Union, reached 55.9bn cubic metres between January 1 and May 15, down 26.5% year on year.

The slump comes after Gazprom cut off gas supply to Bulgaria and Poland at the end of April, after the two countries refused to comply with a Kremlin decree requiring that gas payments to the company be made in rubles rather than other currencies. The decree is aimed at propping up the ruble and shielding Gazprombank, which will receive and convert payments, from future sanctions.

Gazprom has also continued withholding gas supply from the spot market, instead making deliveries only under its long-term contracts with buyers.

Russia has also curbed gas supplies to Germany after imposing sanctions on the former subsidiaries of Gazprom registered in the country. Operational control of those units has been seized by German authorities. According to Bloomberg, however, the move is largely symbolic at this stage, with the cut in Russian shipments only amounting to about 3% of the country’s total imports.

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