Finland money

Russia to cut natural gas from Finland

Russian gas will stop flowing to Finland on Saturday at 7 a.m. local time, Finland’s national gas company Gasum said in a statement on Friday. Poland and Bulgaria were isolated in late April because they failed to make payments in Russian currency – a move EU leaders at the time described as “blackmail” by Moscow.

“It is very unfortunate that the supply of natural gas under our supply contract has now been interrupted,” said Gasum CEO Mika Wiljanen, adding that the company had “prepared carefully for this situation. “.

Earlier this week, Gasum said he was preparing for Russia to turn off the taps after refusing to meet President Vladimir Putin’s demand that ‘hostile’ countries pay for gas in roubles, rather than in euros or dollars indicated in their contracts.

Finland formally announced its intention to join NATO on Sunday, abandoning decades of neutrality and ignoring Russian threats of possible retaliation in a bid to bolster its security following the start of the war in Ukraine.

Russian gas giant Gazprom did not immediately respond to CNN Business when asked for comment.

Finland depended on Russia for almost 68% of its natural gas consumption in 2020, according to the International Energy Agency.

But Russia’s gas exports make up just 3% of the Nordic nation’s total energy mix – which includes energy produced from biofuels and nuclear sources – according to data from Eurostat and the European Network of Energy Managers. gas transport network.

Wiljanen said Gasum “will be able to supply all [of its] customers with gas in the coming months” provided there are no disruptions to the gas transmission network, but added that the winter would be “difficult”.

Gasum Vice President Olga Väisänen told CNN on Friday that Finland also receives gas through its Baltic connection via Estonia. The pipeline connects Finland’s gas transmission network to that of Estonia and allows it to tap into underground storage in Latvia.

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

Since then, EU officials, national governments and energy companies have scrambled to determine whether the new payment mechanism violates sanctions against Russia.

There is still a lot of confusion. Some of the European energy giants have started the process of opening new accounts. Italian energy giant Eni (E)said on Tuesday that he plans to open two accounts with Gazprombank, one in euros and the other in rubles.

But the European Commission insists that guidelines it issued last week prohibit buyers from opening a ruble account. European Commission chief spokesman Eric Mamer told a press briefing on Tuesday that such a move would violate sanctions.

“Anything beyond opening an account in the contract currency with Gazprombank and paying into that account, then issuing a statement that … you have finalized the payment, violates the sanctions “, did he declare.

Some countries urgently need a solution because invoices are coming due. Germany, the bloc’s largest economy, relies heavily on Russian gas to power its homes and industries, although it has managed to reduce Russia’s share of its imports to 35% from 55% before the start of the war.

Earlier this week, the EU announced it would spend 210 billion euros ($222 billion) to wean itself off Russian oil and gas.

Its “REPowerEU” plan aims to reduce its consumption of Russian gas 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 energies.

Robert North contributed reporting.