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An unhappy week for Gazprom

June 15, 2014

Yesterday was not the best of days for Gazprom.

It was first hit by a Lithuanian record fine of $48.2 million, then announcing it would leave the Lithuanian market – an announcement met with glee by the Lithuanian authorities who swiftly bought out Gazprom via two State owned entities for $191.7 million.

Secondly, Ukraine announced that with effect from Monday 16th June it was going to stop buying Russian gas, whilst taking the on-going disagreements between parties to the Stockholm court of Arbitration.

Then came US State Department statements via Marie Harf that Russia had not only allowed tanks through its territory enabling them to enter the territory of Ukraine – but the tanks were indeed Russian Federation tanks supplied to those adverse to Kyiv.

All of this against the backdrop of Bulgaria – and by extension Serbia – ceasing work on the South Stream 2 days before yesterday’s events.

Whether or not broader sector (rather than personal) sanctions follow from the US or not – the combination of these instances seems unlikely to have a positive effect on Gazprom when trading starts again on Monday.

 

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