Russia warns it will not supply gas to Europe 'for free'

Russian officials announced on Monday that the Putin regime is exploring new methods for accepting gas export payments in rubles and said contingencies are being considered in case European countries refuse to pay using Russia’s free-falling national currency.

While meeting in Brussels on Friday, European Union leaders were unable to reach a common ground when discussing Russia’s demand that “unfriendly” countries must pay for gas in rubles and not euros – a declaration that raised concerns over supply security amongst businesses and governments alike.

Russia accounts for approximately 40% of European gas imports and Russia’s central bank, the government and state-owned gas company Gazprom are expected to present their proposals for ruble gas payments to Putin by March 31.

"We are not going to supply gas for free, this is clear," Kremlin spokesman Dmitry Peskov told reporters. "In our situation, this is hardly possible and appropriate to engage in charity (with European customers)."

But European leaders are standing firm against the threat and rallying others to do the same.

On Friday, German Finance Minister Christian Lindner asked German energy providers to refrain from paying for Russian gas in rubles, Der Welt reported.

A top Italian economic advisor said on Monday his government would continue to make contractual payments in euros.

"The only big issue in Europe is gas and Russia is asking us to pay in rubles which we don't have and it's not in the contract," said Italian energy group Eni CEO Claudio Descalzi.

Similarly, Poland’s PGNiG – which has a contract with Gazprom until the end of the year – has said it is not logistically possible to switch the currency of payment.

To help ease Europe into severing ties with Russian oil, the United States announced on Friday that it will supply 15 billion cubic meters of liquefied natural gas (LNG) to the European Union this year. Because American LNG plants are already producing at full capacity, analysts have said that this commitment will mean that exports to Europe will have to come from supplies originally destined to other customers.

European lawmakers have said that the EU will cut dependency on Russian gas by two-thirds in 2022 and end Russian fossil fuel imports by 2027.