Economy

Putin says Russia will stop supplying energy if West imposes price caps

Russian leader says Germany and the West to blame for Nord Stream 1 pipeline closure and calls for return of turbine

Russian president Vladimir Putin delivers a speech at the Eastern Economic Forum in Vladivostok. Photograph: Stanislav Krasilnikov/TASS News Agency/AP

Wed Sep 7 2022 - 11:23

Vladimir Putin on Wednesday threatened to cut off energy supplies if price caps are imposed on Russia’s oil and gas exports and warned the West it would be “frozen” like a wolf’s tail in a famous Russian fairy tale.

Speaking at an economic forum in the Pacific city of Vladivostok, the Russian president said European calls for a price cap on Russian gas were “stupid” and would lead to higher global prices and economic problems in Europe.

The Group of Seven announced plans to impose a price cap on Russian oil exports last week in a move that could also restrict Russia's ability to secure tankers and insurance from countries beyond the G7.

The EU will propose a price cap on Russian gas, alongside measures including a mandatory cut in electricity use, Ursula von der Leyen has said. (European Commission)

Russia would walk away from its supply contracts if the West went ahead with its plans, Mr Putin said.

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“Will there be any political decisions that contradict the contracts? Yes, we won’t fulfill them. We will not supply anything at all if it contradicts our interests,” Mr Putin said.

“We will not supply gas, oil, coal, heating oil – we will not supply anything,” Mr Putin said. “We would only have one thing left to do: as in the famous Russian fairy tale, we would sentence the wolf’s tail to be frozen.”

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Russia is the world’s second-largest oil exporter after Saudi Arabia and is the world’s top natural gas and wheat exporter. Europe usually imports about 40 per cent of its gas and 30 per cent of its oil from Russia.

Mr Putin said Germany and western countries were to blame for the Nord Stream 1 pipeline not being operational and that Ukraine and Poland decided on their own to switch off other gas routes into Europe.

Europe is facing a winter fuel crisis and surging energy bills after Russian state energy company Gazprom fully suspended gas supplied through Nord Stream 1, after it said it found an engine oil leak during maintenance work.

“Nord Steam 1 is practically closed now,” Mr Putin said as he called Germany to return a turbine for the pipeline’s Portovaya compressor station that would allow Russia to resume pumping gas.

“There is an oil leak there – it’s a possibly explosive situation, a fire hazard. The turbine cannot work. Give us a turbine and we will turn on Nord Stream 1 tomorrow. But they don’t give us anything,” he said.

– Reuters

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