The Austrian OMV’s decision to confiscate Russian gas as compensation for arbitration could set a precedent for other countries.
The Austrian company OMV’s decision to stop paying for supplies to Gazprom could set a precedent for other countries seeking to reduce their dependence on Russia’s gas monopoly. It was reported by Bloomberg.
Companies ranging from Italy’s Eni SpA to Germany’s RWE AG say they are entitled to compensation for replacement costs since Gazprom stopped supplying some gas in 2022.
However, these companies are unlikely to receive a cash payment from the Russian gas giant and therefore, like OMV, will be forced to find alternative ways to get the money back. Note that OMV itself was confiscated by Russian gas as compensation for an arbitration award, according to which Gazprom had to reimburse 230 million euros.
According to the lawyers, “if more compensation is awarded to European importers – and this is likely to happen – and although some compensation may be awarded, it will put a lot of pressure on Gazprom’s financial position.”
The possibility of new gas outages is another reason for traders to doubt that Russian flows will continue. Also in the mix are US sanctions against Gazprombank, which European companies use to pay for gas, and uncertainty about flows to Ukraine when the transit agreement expires at the end of the year.
Gas is one of the few valuable assets that Gazprom still has in Europe. The company’s international holdings dwindled following the nationalization of Gazprom Germania at the height of the energy crisis. Arbitral awards are made on a first-come, first-served basis and in Europe they have a duration.
As is known, on October 13, the company announced that it won an arbitration against Gazprom for 230 million euros related to irregular supplies to its German division. On November 16, Gazprom suspended supplies of OMV blue fuel.
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Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.