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 Gazprom CEO sees serious risks in the EU’s new model of energy security and threatens to make a pause in the supplies

миллер miller

Gazprom chief Alexei Miller warned on Monday, April 13, that the EU planned energy union will result in higher prices.

The head of Gazprom, the Russian energy giant, warned European customers on Monday that if their countries angled for a single price for natural gas, it would most likely be at the higher end of the range they now pay, Censor.NET reports citing Liga.

Moscow is ready to continue the dialogue, even by rules of Brussels, but it will be tough. In such a situation the scenario of EU's switch to alternative suppliers, including Iran, looks increasingly possible.

Speaking of creation of the EU's energy union Miller said: "if the European Commission will insist on equal prices, then of course, as you understand, a base price is not the lowest price. It will be the highest price." Moreover, it was the first time when Gazprom openly threatened to suspend the supply of energy: "First, all these volumes may go to other markets. Second, and I want to direct your attention. Our competitive advantage is that we can pause if we are forced to. And we can keep it long enough," Miller claimed.

Read also: Russia will not renew contract with Ukraine for gas transit after 2019 - Energy Minister

Until now, the Russian authorities and the management of Gazprom insisted that it's not true that the South Stream project has been scrapped because of Gazprom's unwillingness to observe the rules of the third energy package and European laws. The only aim was allegedly to preserve the status quo in the transit via Ukraine. Miller said Moscow had to drop its $40 billion South Stream pipeline via Bulgaria to Europe last year, saying it was blocked by EU regulations, choosing the Turkish Stream project instead. "If someone thinks about blocking Turkish Stream ... it is a very serious mistake," Miller added.

Meanwhile, Moscow's tough stance is partly compensated by the recognition that it is willing to accept, at least part of the rules of Brussels. Alexei Miller said that Gazprom may participate in the creation of gas transportation facilities from the border of Greece and Turkey according to the terms of the Third Energy Package, which Russia flatly did not intend to use, and even challenged it at the WTO, as well as "to discuss models of cooperation, including ones within the energy union."

Read also: Putin fears that Russia's gas price for Ukraine will be too low

The European Commission said that "it does not comment on comments", But, according to the interlocutors in Brussels, its position in the gas relations with Moscow has also hardened. Now the EU's claims to Gazprom are not limited to the pricing principles and compliance with the requirements of the Third Energy Package. The EU, which has repeatedly but not too efficiently debated the reduction of dependence on the Russian gas in recent years, may now accelerate the solution to this problem, moving from theory to practice. For example, Iran could become potential supplier to southern Europe. The Commission is eager to carry out meaningful negotiations with Iran on this issue this year, after the international sanctions against this country will be lifted.

 
 
 
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