Alexander Novak reminded Ursula von der Leyen, President of the European Commission, that it was the Western countries that insisted on revising gas contracts towards long-term spot contracts.
“Send yourself the appropriate bills, put them on the table, as they say, because you made those decisions. We also have a saying: no matter how much you wipe the mirror, you will not get any prettier than this,” Novak said.
He noted that we are talking about politicians who have decided to revise the approach to gas purchases from long-term contracts to short-term contracts at spot prices, and also generally abandon any deals on energy supplies.
In December 2020, Gazprom lost its appeal in Stockholm in a Polish lawsuit based on the fact that the Russian company inflated gas prices, according to Warsaw. Subsequently, Poland renegotiated the gas supply contract, abandoning the long-term agreements and entering into a contract for supply at spot prices for the previous quarter. Since the beginning of 2021, some European countries have also signed new contracts with Gazprom, enabling the transition to market pricing.
Then, Western countries faced rising energy prices and rising inflation due to the sanctions imposed on Moscow and the policy of giving up Russian fuel. In particular, due to the increase in gas prices, the European industry began to receive expensive electricity bills, which deprived them of competitive advantages and affected other areas of the European economy.
“Send these invoices to Moscow”
On September 14, von der Leyen, in response to the European Parliament’s criticism of rising electricity and gas prices in EU countries, suggested that disgruntled French lawmaker Manon Aubrey send electricity bills to Moscow.
During the debate in Strasbourg, French MP Manon Aubry showed the EC president that he had significantly increased the gas and electricity bills sent to him by the voters. He also noted that “Europeans are experiencing the current crisis in different ways” and that while energy companies are making unexpected profits “with the connivance of the European Commission”, some French have had to choose between paying bills or shopping for groceries.
Von der Leyen told Aubrey that, according to him, the reason for the rise in prices lay in Russia’s actions.
“The bills you show us can really be called ‘irresistible’ in French. That’s true, but you know – send these bills to Moscow! Von der Leyen replied.
The EC chief also said that the cost of gas in the EU has increased 10 times compared to pre-pandemic levels, but Europeans are responding boldly.
The Kremlin has repeatedly denied accusations that the EU manipulated gas prices. Stating that the increase in gas prices is associated with the sanctions policy of Western countries, the officials reminded that European countries independently revised their contract terms.
“Send the bills to Putin”
On September 15, Greek Prime Minister Kyriakos Mitsotakis invited citizens outraged by rising electricity tariffs to send a bill to Russian President Vladimir Putin. “The invoice for the price increase should be returned to the person who called it, Mr. Putin,” he said.
The Greeks disapproved of the prime minister’s statement and met with bitter irony, asking questions on the topic on social networks: “Is Vladimir Putin now the president of Greece?”
According to Mitsotakis, only the President of Russia is responsible for the increase in electricity tariffs and the ensuing crisis.
price rise
On August 31, analytical company Rystad Energy reported that in August 2022 the average monthly cost of electricity in Europe was the highest on record due to the sharp rise in gas prices.
“One could argue that August will be the most expensive month for electricity in all major European markets,” said company analyst Fabian Renningen.
According to Rystad, the July record was broken in Italy, France, Germany and the United Kingdom, making the Italian market the first market where the monthly average spot gas price exceeded €500 per MWh. In addition, the wholesale price of electricity to be delivered next year in France and Germany at the end of August was €1,000 per MWh.
A sharp rise in gas prices began after Gazprom announced that it would stop pumping gas through Nord Stream during its scheduled work from 11 to 21 July. The next stop took place on August 31. On the night of September 26, a gas leak occurred in the Nord Stream and Nord Stream 2 gas pipelines. Leaks were discovered: two on Nord Stream 1 and one on Nord Stream 2. According to operator Nord Stream AG, it is currently not possible to set a period for the restoration of gas pipelines.
Source: Gazeta
Ben Stock is a business analyst and writer for “Social Bites”. He offers insightful articles on the latest business news and developments, providing readers with a comprehensive understanding of the business world.