Ukraine Passes Russian Sanctions Law: Gas Transit Halt Seems Imminent

Tyler Durden's picture

The Ukrainian parliament approved a law on Thursday to impose sanctions on Russian companies and individuals "for financing terrorism." As Reuters reports, Prime Minister Arseny Yatseniuk told parliament that "by approving the law on sanctions, we showed that the country is able to protect itself." The first 'threat' though - that European energy companies would have to agree major contract revisions when purchasing Russian natural gas, potentially disrupting supplies in the coming winter months - seems suicidal... and EU leaders are not happy. Slovak Premier Robert Fico asked rhetorically, "Isn't it strange that a country, which has signed an association agreement, a country, which we are all trying to help, is taking steps that jeopardize the interests of individual EU members?"

 

As Reuters reports, the Ukrainian parliament approved a law on Thursday to impose sanctions on Russian companies and individuals supporting and financing separatist rebels in eastern Ukraine.

The government has already prepared a list of 172 citizens of Russia and other countries, and of 65 Russian companies, including gas export giant Gazprom, on whom they could impose sanctions "for financing terrorism".

 

After Thursday's vote, Prime Minister Arseny Yatseniuk told parliament that Ukraine had taken a historic step. "By approving the law on sanctions, we showed that the country is able to protect itself," he said.

 

"The law should give a clear answer to any aggressor or terrorist who threatens our national security, our government and our citizens."

 

Ukraine said on Monday that European energy companies would have to agree major contract revisions when purchasing Russian natural gas if parliament approved sanctions on Gazprom.

 

Russia is Europe's biggest gas supplier, meeting almost a third of the region's demand, around half of which flows to European clients via Ukraine. European utility companies are worried that Ukrainian sanctions could disrupt supplies during the coming winter.

But, as Bloomberg reports, European leaders are not happy at Ukraine...

Sanctions imposed by European Union and Russia against one another “senseless on both sides,” “will lead to a weaker EU,” Slovak Premier Robert Fico tells reporters in Bratislava.

 

“I understand this is about principles, but I am far from believing in justice in international politics”

 

"Isn't it strange that a country, which has signed an association agreement, a country, which we are all trying to help, is taking steps that jeopardize the interests of individual EU members?" Fico says, referring to proposed Ukrainian sanctions against Russia which may include suspension of gas transit to Europe

 

“We don’t want be held hostage by the Russian-Ukrainian conflict, we can’t sacrifice our interests in the name of some duel”

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What is worse... as we noted previously, Europe will not be able to produce any of its own shale gas for at least 2 years.