Russia stops natural gas supplies to Finland this Saturday (21)

Russian natural gas will stop being shipped to Finland from 7 am (local time) on Saturday (21), Finnish state-owned company Gasum said in a statement on Friday (20). This is the third European country to have its fuel supply cut off for refusing to accept the Kremlin’s demand for payment in rubles – Russia’s official currency.

Poland and Bulgaria were sanctioned at the end of April for the same reason – something European Union (EU) leaders described at the time as “blackmail” by Moscow.

“It is highly regrettable that the supply of natural gas under our supply agreement is now discontinued,” said Gasum CEO Mika Wiljanen, adding that the company is “carefully preparing for this situation.”

Earlier this week, the state-owned company warned that it was preparing for Russia to turn off the gas pipeline taps after it refused to comply with President Vladimir Putin’s demand that “hostile” countries pay for gas in rubles rather than euros. or dollars stated in their contracts.

Finland formally announced last Sunday (15) its intention to join the North Atlantic Treaty Organization (NATO), abandoning decades of neutrality and ignoring Russian threats of possible retaliation.

Russian state gas giant Gazprom did not immediately respond to the CNN Business when asked to comment on the situation.

According to the International Energy Agency, 68% of natural gas consumed in Finland in 2020 came from Russia. However, gas imports from Russia represent only 3% of the Nordic country’s total energy mix – which includes energy generated from biofuels and nuclear sources – according to data from Eurostat and the European Network of Operators of Power Transmission Systems. Gas.

Wiljanen, the CEO of Gasum, said the company “will be able to supply gas to all [seus] customers in the coming months”, as long as there are no interruptions in the gas transmission network, but added that the winter will be “challenging”.

Gasum’s vice president, Olga Väisänen, told CNN that Finland is also receiving gas through its Baltic connection via Estonia. The pipeline links the Finnish gas transport network to that of Estonia and allows access to underground storage in Latvia.

Gazprom informed its customers that they must open two accounts with Gazprombank – one in euros and the second in rubles, from which gas payments would be made.

Since then, EU officials, national governments and energy companies have struggled to understand whether the new payment mechanism violates sanctions on Russia.

Some of Europe’s energy giants have started the process of opening new accounts. Italian energy giant Eni (E) said on Tuesday that it plans to open both accounts at Gazprombank.

But the European Commission insists that guidance issued last week prohibits buyers from opening a ruble account. The body’s spokesman, Eric Mamer, warned at a press conference on Tuesday that such a move would violate sanctions.

“Anything that goes beyond opening an account in the currency of the contract with Gazprombank, making a payment on that account, and then issuing a statement saying that you have completed the payment, violates the sanctions,” he said.

Some countries urgently need a solution as the situation gets complicated. Germany, the European bloc’s biggest economy, relies heavily on Russian gas to supply its homes and industries, although it managed to reduce Russia’s share of its imports from 55% to 35% before the start of the war.

Earlier this week, the EU said it would spend 210 billion euros ($222 billion) to end consumption of Russian oil and gas.

The plan, called “REPowerEU”, aims to reduce Russia’s gas consumption by 66% before the end of this year – and completely break its dependence before 2027 – by saving energy, finding alternative sources and accelerating the transition to renewable energy.

Robert North, from CNN contributed to the report