The trigger that ended a 50-year-old relationship between Russia’s Gazprom and Austria’s OMV earlier this month was the Austrian group’s decision to seize Russian gas as payment for a debt owed to OMV, several sources told Reuters.
On November 13, OMV announced that it had won an arbitration case against Gazprom. A German court ordered Gazprom to pay 230 million euros to OMV for irregularities in gas supplies. The Austrian group said at the time that it would take immediate steps to enforce the court’s decision by taking action against its own invoices to Gazprom. Three days later, Gazprom suspended gas supplies to OMV, according to Agerpres.
Sources quoted by Reuters claim that OMV has seized gas deliveries for October worth 230 million euros. It was the first time that a customer from the European Union has not paid for Gazprom gas, a source close to the Russian giant said.
A source close to OMV revealed that the Austrian group decided to seize the gas delivered by Gazprom in October, instead of the amount awarded by the arbitration court, because it considered this to be the last chance to recover its money, in the event that Ukraine no longer allows the transit of Russian natural gas through its territory starting in 2025.
In response, Gazprom considers the seizure of the gas as non-payment and has consequently stopped deliveries, the source close to Gazprom said.
The abrupt end to Gazprom’s relationship with OMV has caught many observers by surprise and is a blow to Gazprom’s long-standing political and economic influence in Central Europe. Austria has been one of Gazprom’s most loyal customers, almost entirely dependent on Russian gas even as other EU countries have switched to imports from Norway, the United States and Qatar.
Contracts between OMV and Gazprom include a “take-or-pay” clause, which stipulates that OMV must pay for gas supplied by Gazprom, even if it does not need all the gas in the contract.
A source quoted by Reuters said that Austria’s large gas reserves have given Gazprom a strong position in Europe over the past two decades. The source added that Austria has saved billions of euros from cheap Russian gas since the war in Ukraine broke out.
Austria received Russian gas at a price of between $300 and $400 per 1,000 cubic meters, while spot market prices were over $1,000 per 1,000 cubic meters in 2022, the sources said.
OMV CEO Alfred Stern had been planning to reduce dependence on Russian gas since he was appointed CEO of the Austrian group in 2021, one of the sources said.
Austrian Energy Minister Leonore Gewessler said it was up to OMV to decide whether to end its contracts with Gazprom. “My task and that of the federal government is to create the framework conditions to make this exit possible,” she said.