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Gazprom cuts off gas supplies to Latvia

The Russian State-owned energy giant – Gazprom has suspended the gas supplies to Latvia, accusing it of violating the conditions of purchase

The Russian State-owned energy giant – Gazprom has suspended the gas supplies to Latvia, accusing it of violating the conditions of purchase, without giving any more details.

Latvia relies on neighbouring Russia for natural gas imports, which forms 26% of its energy consumption. The announcement is the latest escalation in the energy dispute between Russia and the European Union (E.U.).

Gazprom had already cut off annual gas supplies to customers in atleast 6 European countries, namely Poland, Bulgaria, Finland, Denmark, Germany and the Netherlands, for not making payment in Russian Rubles.

The European sanctions have hit the Russian economy hard. The sanctions have frozen big chunks of Russia’s foreign reserves. Russia also cannot use Society for Worldwide Interbank Financial Telecommunications (SWIFT), world’s leading provider of secure financial messaging services. In retaliation, Russia demanded European nations to pay for Russian energy in Rubles, which is not acceptable by E.U.

The announcement from Gazprom came just a day after Latvian energy firm – Latvijas Gaze announced it was purchasing gas from neighboring Russia, but not from Gazprom and that it was paying in Euros. Earlier this month, the Latvian Parliament voted in favor of a proposal to ban Russian gas supplies starting January 2023.

Meanwhile, Gazprom has also dramatically cut flows through the Nord Stream 1 pipeline earlier this month, blaming the West for withholding vital equipment due to sanctions. Europe said Russia’s actions were politically motivated.

The pipeline, which delivered about 35% of Europe’s total Russian gas imports last year, had been shut for 10 days for routine maintenance work. When imports resumed last week, gas was flowing through Nord Stream 1 at 40% of its total capacity. The move prompted Germany to declare a “gas crisis” and activate the second phase of its 3-stage gas emergency program, taking it one step closer to rationing supplies to industry.

The E.U. had earlier announced that Member States must reduce natural gas demand by 15% this winter to save gas to prepare for possible disruptions of gas supplies from Russia. However, the bloc has later allowed Member States that are not interconnected to other members’ gas networks from the 15% target. This was done as they would not be able to free up significant volumes of pipeline gas to the benefit of other member states.

Separately, Ukraine said it has killed 170 Russian troops in the past 24 hours and hit arms dumps in the Kherson area.

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