- Russian-Hungarian deal deprives Kiev of revenue and gas
- Kiev wants sanctions against Gazprom
- Kremlin says criticism is politicized
- Said that Gazprom fulfills all its obligations
KYIV / MOSCOW, October 1 (Reuters) – Ukraine on Friday called on the United States and Germany to impose sanctions on Russian company Gazprom (GAZP.MM), accused of using energy as a weapon after that the energy giant has set up a transit agreement with Hungary which deprives Kiev of its gas supplies.
Under a long-term supply agreement with Budapest that came into effect on Friday, Gazprom will no longer ship its gas to Hungary via Ukraine, but via Serbia and Austria.
This deprives Ukraine of transit revenue and also means it can no longer import reverse flow gas through Hungary, which it has been doing since 2015 so as not to buy gas directly from Russia.
Relations with Moscow have been in crisis since its annexation of Crimea in 2014 and its support for a separatist uprising in eastern Ukraine.
Yuriy Vitrenko, the head of Ukrainian company Naftogaz, called on Washington and Germany to honor what he said were toughening commitments with Moscow made in the context of the separate Nord Stream 2 gas pipeline to Germany.
“The Kremlin is doing it on purpose. It’s not even a clank of a saber, it’s the obvious use of gas as a weapon,” Vitrenko said on Facebook.
âA joint statement by the United States and Germany said that if the Kremlin used gas as a weapon, there would be an appropriate response. We are now awaiting the imposition of sanctions on a wholly-owned subsidiary of Gazprom, the operator of Nord Stream. 2. “
He was referring to an agreement between Berlin and Washington on Nord Stream 2 reached in July. Read more
The dispute comes at a sensitive time for Russia, which wants Germany to certify the Nord Stream 2 pipeline to Germany now that it is complete. Russia is accused by critics in the Kremlin of trying to speed up this approval process by deliberately not doing enough to supply Europe with gas during an energy crisis that has seen spot gas prices soar.
Russia denies the allegations.
There was no immediate response from Washington or Berlin to Vitrenko’s call. The Kremlin has dismissed Ukrainian criticism as unfounded and politicized.
Kremlin spokesman Dmitry Peskov said Russia is fulfilling all of its obligations under existing natural gas contracts.
“There have been and there will be accusations against Russia, the majority if they are politicized,” Peskov said, when asked about Ukraine’s complaints.
“The main thing in this situation is that we are constantly fulfilling our obligations.”
Gazprom did not respond to a request for comment.
“SHOCKING RISE” IN GAS PRICES
Russian gas supplies via the Yamal-Europe gas pipeline, which crosses Poland, fell nearly 77% on Friday on Thursday, according to data from network operator Gascade, Gazprom having reserved only a third of the capacity available for October.
The Russian company has repeatedly stated that it is supplying its customers with gas in full compliance with existing contracts and that additional supplies could be provided once Nord Stream 2 is launched.
Gazprom’s natural gas exports outside the former Soviet Union grew 15.3 percent year-on-year in the first nine months of 2021 to reach 145.8 billion cubic meters (bcm), the Russian gas producer.
Ukraine hopes that the European Union, of which it is not a member, will step in and curb Gazprom.
“The monopolization of gas routes by Gazprom, which we are currently seeing, raises the question of the fundamental principles of the functioning of the EU (European Union) gas markets – competition and transparency,” said Sergiy Makogon, head of the Ukrainian Gas. Operator of the transport network.
“The strengthening of an actor’s dominant position and its use of leverage for obviously political ends against a backdrop of shocking gas price increases in Europe must be stopped,” he said.
Ukraine has opposed Russia’s new gas deal with Hungary, calling it this week “a purely political and economically unreasonable decision.” He asked the EU executive to assess whether it is complying with European energy law. Read more
Kiev is also putting pressure on the West to try to prevent the start of the Nord Stream 2 gas pipeline, which bypasses Ukraine.
German utility Uniper, which is part of the Western group of companies supporting Nord Stream 2, said on Friday it did not expect the pipeline to help ease the strained global gas market this winter as it is unlikely that a business license will arrive soon. Read more
HOT UKRAINE AND HUNGARY
The dispute over the gas deal has turned into a bilateral dispute between Kiev and Budapest, who are already at odds over the use of the Hungarian language in Ukrainian schools.
Hungary accused Ukraine of interference, and Prime Minister Viktor Orban on Friday dismissed Ukraine’s criticism of the gas supply deal. Read more
Orban, who will face his first competitive election next year after three landslide wins since 2010, said without the gas deal, Hungarians would have to pay much higher prices.
“We need gas. This is reality. You (the Ukrainians) have to agree with the Russians,” Orban told state radio.
Reporting by Natalia Zinets and Andrew Osborn Additional reporting by Vladimir Soldatkin, Dmitry Antonov and Tom Balmforth in Moscow and Krisztina Than in Budapest Writing by Matthias Williams and Andrew Osborn Editing by Alexander Smith and Frances Kerry
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