Germany issues warning of possible gas shortage

Germany has issued a warning regarding a possible gas shortage following the dispute with Russia after Putin demanded payment in Roubles.

Berlin is preparing for the possibility of rationing gas in case its gas supply from Russia is interrupted. The German Government has taken its first formal step, under German Economy Minister Robert Habeck, which consists in implementing the  “early warning phase” of its emergency law.

This step has been taken in an attempt to combat the potential shortage of fuel on which its strong industry, as well as the heating of 83 million of its inhabitants rely.

Last week Putin stated that Russia was going to demand payment in Roubles by hostile countries. The European Union is amongst these, with 40% of its gas imports coming from Russia. Western countries have stated that the change in payment currency would mean a breach in contracts, causing a timely delay for contract renegotiation that could take months or more.

The German Government’s initial reaction was one of defiance, with Habeck stating: “Germany will not accept any breach of contracts.”

If Russia were to cut off Germany’s gas supply, Germany’s industry would be the first to suffer, with  the German Government promising to prioritise the needs of private households, hospitals and other critical institutions.

These cuts to German industry could pose a very real risk, “causing industrial production to shrink by as much as 9%” said Deutsche Bank Senior Economist Eric Heymann.

Thank you for taking the time to read this article, do remember to come back and check The Euro Weekly News website for all your up-to-date local and international news stories and remember, you can also follow us on Facebook and Instagram.