What Can Moscow Demand from Chisinau for Gas Supplies as of May 1

Sergiu CEBAN

Judging by the yesterday’s statements of the president, supplies of Russian gas to Moldova will continue after all. But on what conditions?

Last week a wave of the extremely dangerous events began to cover Moldova threatening to lead the sociopolitical situation in the country out of a fragile equilibrium with the cumulative negative effect. The events in the Transdniestrian region are deeply rooted in the international information agenda and apparently the left-bank issue will be in the spotlight for some time. Meanwhile, there are just a few days left until May 1, when Russia could cut us off from gas because of our violating the contract with Gazprom signed last fall. In this case we will also lose our ability to buy electricity from the Kuchurgan power plant. In such an emergency, we’ll probably have to urgently seek help from belligerent Ukraine or European partners not to find ourselves in a complete energy collapse. There’s no doubt left that Moscow can turn high-minded. Yesterday’s stoppage of blue fuel supplies to Poland and Bulgaria due to the unwillingness to pay in rubles was an alert signal for many. It seems that the Kremlin is indeed ready to keep raising the stakes and aggravating the situation, especially towards the states whose influence in Europe is not so strong. This forewarning has raised serious concerns, especially in those countries most dependent on Russian gas. While Poland can still afford to break with Moscow, Bulgaria is almost 90 percent dependent on Russian gas imports. Brussels reasonably called the unilateral gas cutoff a Russian attempt to use energy resources as a geopolitical tool and another confirmation of Gazprom’s unreliability as a gas supplier. Despite the irregular situation (which, I think, was prepared for), we must give credit to the European Commission, which found a quick solution and organized gas supplies to Poland and Bulgaria from neighboring countries. However, the problem turned out to be only partially solved. The crisis and the change in supply logistics immediately put pressure on the European energy market and led to a corresponding price hike. By the evening gas price in Europe grew by almost 25%, exceeding $1,300 per thousand cubic meters. This constant instability on the international markets seems to deprives our government of any prospects to reduce tariffs for the population at least for the summer period. In this context somewhat discouraging is the information published in the American press stating that about ten EU countries have accepted Moscow’s ultimatum and set up ruble accounts in Gazprombank for settling payments for consumed energy. If so, a loss of trust and unanimity among member states could trigger painful centrifugal processes and deepen internal divisions in the EU. However, the Europeans can handle with their problems, but the question of what can Moldova expect in such conditions is the one that hasn’t been answered clearly so far. Earlier, Deputy Prime Minister Andrei Spinu did not rule out that Moldova will be without Russian gas in May because the government failed to audit the historical debt to the Russian company within the stipulated time frame with Moscow. Meanwhile, according to him, we can to buy gas from international traders, who have expressed their willingness to supply us with the blue fuel. After a month of clearly pointing to the possibility of ending Russian gas imports, the other day there was a U-turn. And now the Parliament Speaker Igor Grosu somewhat intriguingly implied that the authorities had begun talks with Russia on extending the debt audit and continuing gas supplies after May 1. This signal was indirectly confirmed yesterday by the president, suddenly admitting that we cannot really give up on Russian gas now, which, in fact, has no alternative. Moreover, according to Sandu, the issue of Moldova’s electricity supply depends directly on energy supplies, especially since there’s no interconnection with Romania. If the authorities have tried at least somehow to reduce the growing social tension on the issue of gas and hide complete unpredictability behind the veil of reassuring statements, the situation with electricity is somehow very ambiguous. The contract with the only supplier at the moment – the Moldovan GRES – expires on May 1. Earlier, the government tried to re-sign it for a year, but the Russian company agreed to do so only for a month. The day before, the Extraordinary Commission extended the bidding deadline for the purchase of electricity until April 28, even though it was originally set for April 22. It turned out that the April 15 tender was won by two companies whose real beneficiaries the supervisory authorities could not identify. However, Natalia Gavrilita does not see any risks in the fact that there are only three days before the expiry of the last contract. Moreover, according to the premier, during this time it will be possible to continue negotiations on the most favorable price for the population. It is difficult to share our authorities’ optimism. We simply want to believe that they really have more information and know what they are doing. However, based on the experience of the current Cabinet of Ministers, we must prepare for the worst scenario, because the regional crisis can be written off as a sign of practically all managerial mistakes systematically made by the government. At least the fact that they are negotiating with Moscow is encouraging – the only question is what conditions the Kremlin will set for achieving the “energy compromise”. After all, Russia did not let the situation go to the brink of an abyss just to go along with to the Moldovan leadership. Judging by the public statements of the Russian representatives the main demands will most likely concern the termination of support for Ukraine, first of all material and technical, the possibility of concluding direct gas contracts with the contractors on both banks of the Dniester, as well as reducing risks with regard to the Transdniestrian region.