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Moldova presses EU for more help to avert crisis over Russia gas deal

Moldova’s prime minister has warned that the country is on the brink of an economic and social crisis as she called on the EU to offer more support to help the country weather pressure from Russian gas producer Gazprom.

Natalia Gavrilita said in an interview that the “next two to three weeks” would be crucial. “These next few weeks are the time for Moldova’s friends to step up . . . [Otherwise] it will be very difficult politically, socially and economically for the country,” she told the Financial Times.

The former Soviet state has declared a state of emergency after Kremlin-controlled Gazprom cut gas deliveries by a third and threatened that supplies could be shut off if Moldova did not agree to a more expensive contract.

Gazprom has also said Moldova can get a better deal on gas if the country gives up some pro-EU policies, people briefed on negotiations told the FT this week.

Gavrilita declined to comment on Gazprom’s offer, citing the negotiations with the Russian company.

But she said she would “prefer not to be put in that position” of choosing between cheaper gas and closer relations with Brussels.

The Moldovan crisis is part of a wider European gas crunch that has led critics of Gazprom, Europe’s largest gas supplier, to suggest it is trying to extract political concessions and punish countries and governments that it disagrees with.

Russia has denied that politics has played a role in Gazprom’s negotiations with Moldova, and said it was discussing a new contract “exclusively on commercial terms”.

Gavrilita’s enthusiastically pro-EU party won a landslide victory in parliamentary elections this year and wants to take Moldova out of its historic Russian orbit.

The EU on Wednesday agreed to provide Moldova with a €60m grant, equivalent to 20 days of gas imports. The grant had given the country vital space “to keep negotiating without a ticking clock”, Gavrilita said.

But she estimated that, without an acceptable deal from Gazprom, Moldova would need to spend about €800m over the next five months on alternative imports to meet its winter demand, based on market prices. That would require more support from Brussels, she said.

“These are the four, five months when the EU really has to make absolutely clear that it supports Moldova,” Gavrilita added. “The volumes that Moldova needs are very small . . . in the European context. We do hope we can count on continued support.”

This week Moldova bought its first non-Russian gas in four trial open-market purchases totalling 5m cubic metres, enough to meet less than two days of demand. The country is in talks over possible supply deals with national gas companies in Poland and Romania, and international trading companies that own gas stored in Ukraine.

Gavrilita declined to comment when asked if EU companies were offering below-market prices as an alternative to a new Gazprom deal. But she said the country was discussing potential contract structures and repayment schedules that would make overall costs cheaper than spot market prices.

“There are no easy solutions here. We are looking for a long-term contract, a price that will help us deal with the current price abnormality,” she said. “We are discussing various options with European partners.”

Josep Borrell, the EU’s foreign policy chief, said on Thursday that the bloc’s €60m payment was the “first step” of support to the country, adding: “This is what a partner does.”

Borrell said the EU would not forbid Moldova to sign a new deal with Gazprom, but that Brussels was “strongly against” what he described as “weaponisation of the gas supply”.

“Be sure that this [EU] money is not going to go to Gazprom’s pockets. It is going to go to the most vulnerable Moldovan people,” he added.

Gavrilita said that negotiations with the Russian company would continue, and that Chisinau had always been “open to remain a partner to Gazprom . . . [with] a normal, economic, predictable relationship”.

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Gazprom’s levels of gas storage in the EU are well below usual seasonal levels, which has led some market analysts to say the company is trying to exert pressure for approval of the Nord Stream 2 pipeline to Germany.

Russian president Vladimir Putin this week told Gazprom to begin filling storage facilities in the continent from next month.

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