Moldova: Russia threatens gas supply in Europe’s poorest state

Your country is plunged into a gas crisis. But Nicu Popescu is trying to stay positive.

“Our country made history on Monday,” the Moldovan Foreign Minister tells me. “For the first time, Moldova bought gas from a source other than Russia’s Gazprom”.

The shipment of gas from Poland’s PGNiG was one million cubic meters.

Moldova will need much larger volumes if Gazprom does what it has threatened to do: turn off the gas taps.

So far 100% of Moldovan gas has come from Russia. But the supply contract expired at the end of September. Gazprom raised the price and Moldova hesitated to pay it. In the absence of a new deal, the Russian energy giant cut supplies, prompting Moldova to declare a 30-day state of emergency. Gazprom accused Moldova of “causing a crisis” and demanded the repayment of a $ 709 million (£ 514 million) debt, which Moldova disputes.

The negotiations continue. Moldovan officials say they would like to sign a new contract with Gazprom, but only if conditions are favorable.

If there is no deal with Russia, could Moldova, one of the poorest countries in Europe, be able to buy enough gas elsewhere?

“This is the worst time to have a gas crisis at home,” admits Popescu. “Prices are higher than ever. We see this market crisis on a global scale. But we have had support. In recent years Romania has built a new pipeline in Moldova that provides us with a safety valve. We have also received some advice from the European Union on how to diversify a country’s gas supply in a few days “.

Like many businesses in Moldova, the Drochia sugar factory was hit by the shortage.

“We are only able to use a quarter of the gas we need,” explains manager Rostislav Magdei. “We are adding alternative sources of energy. We hope our government compensates for any losses resulting from the high price of fuel.”

Once in Moscow’s orbit, Moldova has more recently moved from Russia to the West. The country’s leadership is now pro-European and supports closer ties with the EU. Many here suspect the gas crisis is the Kremlin’s way of expressing its disapproval.

“This year we had parliamentary elections and the pro-Russian party lost,” said Sergiu Tofilat, former energy adviser to the President of Moldova. “Here we have a pro-Western party in power. So, Russia has changed its approach to gas supply. The Kremlin wants to punish the Moldovan people for voting against a pro-Russian party. It’s pure politics.”

“Vladimir Putin is trying to keep the former Soviet countries in the Kremlin’s area of ​​influence. We do not want to remain on our knees before Moscow. We must say no to Russian blackmail and we have the opportunity now to free ourselves Russian influence in Moldova.”

The Kremlin denies using energy as a weapon. President Putin recently dismissed the suggestion as “utter nonsense, nonsense and politically motivated gossip.”

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For Moldova, however, reducing Russia’s influence will not be easy. In energy terms, Moldova is closely linked to Moscow. Not only has the country been 100% dependent on Russian gas. But its gas company, Moldovagaz, is owned by Gazprom. And more than 80% of Moldovan electricity comes from a Russian-owned power plant in Trans-Dniester, a separatist region of Moldova, supported economically, politically and militarily by Moscow.

If you think of gas negotiations as a game of poker, then Russia has a very strong hand.

But the Trans-Dniester could prove to be a weak point for Moscow.

“Gazprom needs a gas contract with Moldova so that it can also supply gas to the breakaway region,” says Sergiu Tofilat. “Gazprom is a public company, with publicly traded shares. It cannot afford to sign a contract with the Trans-Dniester supplier which is not officially recognized.”

In the city of Bălți, Moldovan motorists feel the effects of less gas. I see long lines at the propane station. In line here are dozens of disgruntled cars and drivers.

“We are in this situation, because we are looking towards Europe,” a taxi driver named Valera tells me. “If we were with Russia everything would be different”.

“The problem is”, says another pilot Yura, “that our leaders now want to be friends of Europe and America. For cheap gas they should go to Moscow, find an agreement. We must bow to Russia.”

For a government that has charted a pro-European route, there is the danger: that a prolonged shortage of gas and higher energy bills could make Moldovans doubt the direction in which their country is moving.