“No rubles, no gas”. Vladimir Putin ‘s ultimatum has shaken the West, but as we explained in these columns it is an escalation more of a facade than of substance. Because the tricks are already foreseen to preserve the status quo, at least for a few weeks, such as payment via “special accounts” on Gazprombank (which will not be ready for another ten days) and a convoluted mechanism of conversion into rubles which in fact allows European buyers to pay in euros, as confirmed yesterday by Mario Draghi .
The rationale of Putin’s move has a lot to do with the strengthening of the ruble, which in effect has almost returned to the same value against the dollar as it was before the war (although today it is in sharp decline, perhaps the markets have called the bluff. of Moscow). Export profits are also involved, a lifesaver for the Russian economy under sanctions. And the solidity of the latter is put to the test by the attempt to force Europeans to convert euros into rubles through the Russian Central Bank, itself sanctioned.
Either way, the Tsar’s move meant that European countries began to gear up to see how much substance lies behind the Tsar’s “blackmail” – because, after all, the Russian economy needs liquidity as much as the EU has. need Russian gas. The Commission is working to arrive at a common position among the 27, some of whom have already explained in no uncertain terms that they will not yield to the conditions of the Tsar. France, Germany and Austria are already talking about rationing. In parallel, diversification is being considered.
Now it is a question of how sustainable are the positions of the two fronts, which seem determined to see which yields first. On the one hand, Russia is showing signs of escalation and is considering extending this mechanism to other raw materials as well. On the other hand, the EU seems willing to tackle the possible interruption of 40% of its gas supplies. This hypothesis is not too realistic in the very short term: the contracts specify the payment currency, and a unilateral modification by Gazprom, explains the Financial Times, would open a dispute to bring to the attention of the Stockholm Arbitration Court.
This is a process that takes months, during which gas should continue to flow until the dispute is resolved or at least an order is issued. Suspending the disbursement could trigger an even heavier compensation for damages in the event of an arbitration award in favor of the buyers, and in any case it is an unsustainable scenario for the Kremlin, which has an interest in making a big voice and keeping the point, certainly not. to stop the pipes. If Gazprom stops everything, it also stops receiving euros, dollars and pounds, and the value of the ruble could plummet.
In practice, the Russian operator is actually able to “shut down” the extraction of gas with relative ease. What it cannot do, due to the existing infrastructure, is divert the bulk of supplies elsewhere: the Siberia-China pipeline will take at least another three years, liquefaction plants and LNG carriers are not enough to compensate. Russia would thus be forced to use its own storage facilities, plus the network itself, to retain gas. The Russian storage capacity is equivalent to less than half the volumes it ships to Europe each year; according to an ICIS expert heard by FT, the entire system would be full in four and a half months. At this point, it is a question of whether the Russian economy does not collapse sooner.
On the other hand, European countries are pushing to replenish their reserves. The spring period is precisely the time when the operators plan the fillings; today skyrocketing gas prices affect the success of the first auctions, as an expert on the matter explained to Formiche.net. There are several ways to pull down the price, but they depend on the political will of the member countries. Meanwhile, it is pushing for gas imports from other sources (including the USA and the countries of the Mena area). However, even in the best of scenarios, it will take at least four years to replace gas imports from Russia.
There is a pear tree. The analysts of Bruegel, one of the most listened to think tanks in Brussels, believe that the EU as a whole is able to go through a short period without supplies from Russia. Also next winter, as long as states make difficult choices and adopt rationing policies that lead to a reduction in overall demand of 10-15%, or 400 terawatt hours. It is possible, the experts write, adding that “a range of exceptional options could reduce at least 800 TWh”.
So, admitting the unlikely hypothesis that Russia finds a way to cut off the gas and not collapse in a matter of weeks or months, the EU is able to hold out for at least a year – provided a political understanding is reached. among the Twenty-seven, who would be more inclined to do so if really cornered. It remains more likely that Gazprom will continue to supply Europe, both because of the legal “leash” and to ensure the flow of revenues to the Kremlin; the readiness of the conversion system via Gazprombank indicates that Moscow at least wants to keep the door open.

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