It has been observed in early April that Russia warned most countries in Western and some parts of Eastern Europe that they'll stop energy supply to them if they refuse to pay for natural gas in roubles.
This brought several controversies within Europe and America's, most especially to Western European countries who depended on Russia's gas supply to meet up with increasing demands on production in all facets of their economy.
Most person's saw this approach by Russia as a breach of contract, but he who owns the gas could wake up anytime and end supply and this will affect many due to over dependence on Russian energy.
In response to Russia's military campaign in Ukraine, Moscow was hit with unprecedented economic sanctions, which also froze $300 billion of Russia's foreign currency reserves held abroad.Source
All this happenings around natural gas and nitrogen supply is as a result of the several sanctions placed on Russia by members of NATO. Some weeks after Russia's military invasion of Ukraine, most countries around the world asked Russia to withdraw from Ukraine and the refusal of Russia was automatic sanctions from members of NATO.
All speculations about Russia's stopping of energy supply have finally become true, with two Eastern European countries being the first victims.
Today being 27 April, Russia's energy giant Gazprom halts gas supply to Poland and Bulgaria due to refusal to follow the new payment system for gas supply.
The need for a new payment method was a result of unprecedented unfriendly steps in the economic sphere and the financial sector, which were taken against us by unfriendly countries," Kremlin spokesman Dmitry Peskov told reporters.
"This need was dictated by the fact that, as you know, they blocked from us -- or, to put it plainly, stole -- a fairly significant amount of our reserves," Peskov said, adding that this led to a "transition to a new payment system".Source
Russian President describes anyone who refuse to payment in her local currency as a thief and said, Russia doesn't steal other products that they import into her country.
What's the Implications of Russia's action on Poland and Bulgaria
This will become a big setback to the economies of Poland and Bulgaria and the following will be the resultant effects of Russia's action:
- it'll increase the cost of energy on local businesses. Since majority of the citizens of these countries depends on natural gas to operate their businesses.
- it'll increase unemployment in Poland and most especially Bulgaria who depends more on Russia's supply of natural gas.
- high cost of goods sold in the market.
- increase of livelihood.
What's my take on this? And how should the government's of Poland and Bulgaria come out this situation?
It comes in two ways: either the countries involved should pay Russia in rubles for the natural gas supply.
Or
Western Europe should been able to look out for alternative source of energy to foster growth of their economy.
Thanks.