Balkans become hostage to Russo-Ukrainian standoff

08/01/2009

Most of the Balkan countries are feeling the brunt of the natural-gas dispute between Russia and Ukraine, which has cost them access to new supplies.

(Various sources — 06/01/09 - 08/01/09)

The heads of Russia’s Gazprom and Ukraine’s Naftogaz met in Moscow Thursday (January 8th) to discuss solutions to a dispute over gas prices and transit fees, which has hit EU and Balkan countries in one of the coldest winters in decades.

Gazprom CEO Alexei Miller and his Naftogaz counterpart, Oleh Dubyna, held their first face-to-face talks since the start of the crisis on January 1st, when Russia cut off gas shipments to Ukraine. Moscow and Kiev blame each other for the shutdown.

Russia provides 25% of Europe’s total gas supplies, delivering about 80% of that fraction through pipelines that cross Ukraine.

Bulgaria, which depends on Russia for 96% of its gas, was one of the EU nations worst hit by the immediate loss of supply on Tuesday.

Millions of Bulgarians felt the impact of that move almost immediately, as radiators in centrally heated buildings across the country went cold before sunset and utilities scrambled to find alternative fuels. Dozens of schools and kindergartens closed down Wednesday as temperatures indoors fell below the legal minimum. Some hospitals said they might have to treat only patients requiring emergency care. The employers’ organisation in the EU’s poorest member said businesses were losing about 250m euros a day.

Neochim, one of Bulgaria’s leading fertiliser producers, said it escaped a major explosion Tuesday when it had to shut down its facilities on a hasty emergency basis.

Macedonia, Greece and Turkey are also coping with shortages. The last two are slightly less dependent on Russian natural gas and have alternative supply routes, but Macedonia — like Bulgaria — relies almost completely on Russian gas.

Two of Macedonia’s biggest factories reportedly had to cease production after the Orthodox Christmas on Wednesday.

Bosnia and Herzegovina (BiH), Croatia, Serbia and Romania also reported a total cutoff of Russian deliveries, affecting them to varying degrees. Setimes

Gas Cuts Shut Down Macedonia Factories

Skopje | 08 January 2009 |

Two of Macedonia’s biggest factories, Maksteel and the pipe factory October 11 have been forced to halt their production due to gas shortages resulting from the Russia-Ukraine dispute.If the crisis with the Russian gas continues, nearly 2000 workers at the two plants could be faced with  forced leave.

“Maksteel is not working. The systems are reduced to a minimum only for maintenance”, factory manager Aleksandar Panov told local Utrinski Vesnik daily on Thursday.

The situation is identical in the October 11 pipe factory, the newspaper reports.

On New Year’s Day Russia’s gas export monopoly Gazprom cut all supplies for Ukraine’s domestic use in a row over gas prices, creating a knock-on effect for Europe which receives one fifth of its gas from pipelines through Ukraine.

According to law, all companies in Macedonia must have an alternative power source secured for emergencies, and all heating plants across the country that usually operate on gas have already switched to oil derivatives.

Experts say Macedonia is not that badly affected as gas is not widely used in households. But the shutdown in production of these major industrial units is  impact domestic growth already dampened by the global financial crisis.

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