Austria says Russia to cut off gas supplies on Saturday

Russia’s state-owned natural gas company Gazprom will end its gas deliveries to Austria this weekend, Austrian energy firm OMV said, but Chancellor Karl Nehammer reassured his country that there is a secure supply of fuel.

OMV said on Friday that Gazprom will stop supplying it with gas on Saturday, according to media reports. 

The cutoff follows OMV’s announcement that it would stop paying for Gazprom gas to its Austrian arm to offset a €230 million arbitration award OMV won over an earlier cutoff of gas to its German subsidiary. The prospect of Gazprom shutting off supplies had made gas prices jump.

It’s unclear whether Russia has carried through with the threat, Euronews reported on Saturday. Gazprom is sending gas to Europe via Ukraine at normal levels, Bloomberg reported on Saturday.

Nehammer said on Friday that Austria has a secure supply of alternative fuel and that “no one will freeze this winter, no home will be cold.”

Russia cut off most natural gas supplies to Europe in 2022, blaming disputes over payment in rubles. EU leaders described the move as energy blackmail over their support for Ukraine against Russia’s invasion. The cutoff sent gas prices soaring and contributed to a sharp burst of inflation that went into double digits but has since been going down.

European governments had to scramble to line up alternative supplies.

Still, three European countries — Austria, Slovakia and Hungary — have been getting supplies of Russian gas via a pipeline through Ukraine despite the fighting there. Ukraine has said it will not extend the transit agreement with Gazprom beyond January 2025 in a bid to choke off a source of income that Kyiv says Russia uses to fund its war and pushing these countries to diversify supplies.

Austria gets most of its natural gas from Russia. Last December, the country’s dependence on Russia for gas rose to 98 percent and Vienna has been looking to accelerate the end of its Russian gas ties. In February, Vienna announced plans that would force domestic energy firms to slowly phase out Russian gas and explore options for an early end to the country’s long-term gas contract with Moscow.

German Chancellor Olaf Scholz, meanwhile, on Friday spoke by phone with Russian President Vladimir Putin in their first direct exchange in nearly two years.