Printed on Wed Aug 10 2022 4:27:27 PM

Europe denounces 'gas blackmail' as Sanctions mutilate Russian economy

International desk

European leaders denounced Russia's attempt to "blackmail" Ukraine's partners over gas supplies, as Western sanctions mutilate the Russian economy already struggling with its worst crisis since the 1991 fall of the Soviet Union.

Ukraine said Europe ought to stop depending on Russia for exchange after it stopped gas supplies to Bulgaria and Poland for not paying in roubles, as the shutoff uncovered the continent's weaknesses and divisions on Wednesday, April 27th.

Germany, the greatest purchaser of Russian energy, desired to stop importing Russian oil within days but warned a Russian energy ban or bar would tip Europe's largest economy into downtown.

A Russian economy ministry document indicated that Russia's economy could shrink by as much as 12.4% this year, further evidence that foreign sanctions were taking a heavy toll.

Foreign sanctions have frozen about $300 billion of the roughly $640 billion that Russia had in its gold and foreign exchange reserves when it invaded Ukraine. Russia is also struggling with soaring inflation and capital flight while grappling with a possible debt default due to the sanctions.

Gazprom, Russia's gas export monopoly, suspended gas supplies to Bulgaria and Poland on Wednesday for not paying in roubles, as stipulated in a decree from Russian President Vladimir Putin that aims to soften the impact of sanctions.

"The sooner everyone in Europe perceives that they cannot rely on Russia for trade, the sooner it will be possible to ensure stability in European markets," Ukrainian President Volodymyr Zelensky said late on Wednesday.

While the president of the European Commission said Gazprom's suspension was "yet another attempt by Russia to use gas as an instrument of blackmail", EU member state ambassadors asked for clearer guidance on whether sending euros breached sanctions.

France will host a meeting of EU energy ministers on May 2.

Kremlin spokesperson Dmitry Peskov said Russia remained a reliable energy supplier and denied it was engaging in blackmail.

He declined to say how many countries had agreed to pay for gas in roubles but other European customers said gas supplies were flowing normally.


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