The Netherlands and Denmark face a gas cut for refusing to pay Russia in rubles

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Gazprom Export is about to cut gas supplies to Denmark and the Netherlands because the two countries have refused to buy their oil in Russian currency.

Denmark’s Orsted and Netherlands’ GasTerra issued statements warning that they would not pay for gas supplies from Gazprom Export in roubles.

Both companies released statements saying the payment deadline was May 31. Orsted maintained that Gazprom Export, the Russian oil supplier, would stop supplies, although he said he would view this as a breach of contract.

“Gazprom Export continues to demand that Ørsted pay for gas deliveries in roubles. We have no legal obligation under the contract to do so, and we have repeatedly informed Gazprom Export that we will not. The payment deadline is May 31 and Ørsted will continue to pay in euros,” Orsted said on Monday. “Therefore, there is a risk that Gazprom Export will stop supplying gas to Ørsted. In Ørsted’s opinion, this will be a breach of contract.”

Orsted noted that no gas pipeline goes directly from Russia to Denmark, but it has storage facilities it is laying down in Denmark and Germany to ensure gas supplies to its customers.

GasTerra, which buys and trades gas on behalf of the Dutch government, said its contract with Gazprom was due to end on October 1, but it has taken steps to buy gas from other suppliers.

“GasTerra repeatedly urged Gazprom to adhere to the contractually agreed payment structure and supply obligations, but to no avail,” he said.

The company is 50% owned by Dutch government entities and 25% each by energy giants Shell and Exxon.

Russia has halted its gas exports to Finland from May 21. The Russian firm previously halted Polish PGNiG and Bulgarian Bulgargaz due to their refusal to trade in rubles.

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