Putin Warns He’ll Freeze Energy Supplies To The West If Price Caps Are Imposed

Topline

Russian President Vladimir Putin on Wednesday doubled down on threats to cut off all energy supplies to Western countries if they impose price caps on its oil and gas exports, ratcheting tensions and escalating Europe’s energy crisis as Moscow struggles to supply its military under sweeping sanctions.

Russian President Vladimir Putin attends the plenary session of the Eastern Economic Forum in … [+] Vladivostok.

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Key Facts

Speaking at an economic forum in Vladivostok, a port city in Russia’s far east, Putin said Russia would walk away from its supply contracts if price caps are imposed on the country’s energy exports, Reuters reported.

“We will not supply anything,” Putin said, adding that the West would be “frozen” like the tail of a wolf in a Russian fairy tale.

Putin slammed European calls for a price cap on Russia’s energy exports, describing proposals as “stupid” and counterproductive.

The Russian leader also blamed Western nations for the closure of the Nord Stream 1 gas pipeline, the first time he has commented on it since the conduit closed indefinitely on Friday.

Putin said the pipeline could restart as soon as “tomorrow” if the West lifted sanctions and returned a crucial turbine from repairs, reiterating an old argument that is disputed by other involved countries like Germany and the company that maintains the equipment.

Putin’s threats to halt energy exports echo similar warnings the Kremlin issued last week after the Group of Seven countries announced they had reached an agreement on a price cap for purchases of Russian oil.

What To Watch For

Deals with China. Putin said a drop in gas exports to Europe, one of its biggest markets, would not bother Russia. Gazprom, the state-owned energy firm, has already agreed on key details for a supply deal with China, Putin added. The Russian president is set to meet his Chinese counterpart Xi Jinping on his first trip abroad since the start of the Covid-19 pandemic, the Russian ambassador to Beijing announced Wednesday.

Tangent

Putin also threatened to tear up the deal allowing Ukraine to export its grain after accusing Western countries of “brazen deception” over where supplies were actually going. Contrary to UN data, Putin said almost all of the grain exported by Ukraine—excluding that going to Turkey, which brokered the deal—was going to the European Union and not the world’s poorest countries. Ukraine is a major grain exporter and food prices have skyrocketed due to Russia’s invasion.

Key Background

Russia is one of the biggest energy suppliers in the world. Europe in particular relies on Russian imports for its energy needs and supply changes stemming from the war in Ukraine has triggered a crisis throughout the region. Putin’s speech comes amid a standoff over the shutdown of the Nord Stream 1 pipeline between Russia and Germany, a major source of European gas, which was purportedly shut for routine maintenance work but has now been closed indefinitely. European officials have accused Moscow of weaponizing its energy resources to retaliate against Western sanctions for invading Ukraine and have proposed price caps on exports to choke Putin’s coffers. The Kremlin strongly rejects the notion it is playing politics with its energy—the indefinite shutdown was announced shortly after nations agreed to cap the prices of Russian oil exports—and says sanctions are responsible for the shutdown and other issues.

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