Poland & Bulgaria cut off from Russian gas

Gas dependency in Europe could cause disruptions in factory production

May 10, 2022 – Russia will halt gas supplies to Poland and Bulgaria after the two countries refused to pay for supplies in the Russian ruble. Both countries receive a substantial amount of their domestic gas consumption from Russia: 45% for Poland and 73% for Bulgaria. 

Major Manufacturing Plants Remain Unaffected 

Poland and Bulgaria’s state gas companies, PGNiG and Bulgargaz, will not be renewing their contract with Russian gas supplier Gazprom at the end of 2022. Both countries have made significant progress in securing natural gas from European Union countries. Furthermore, major manufacturing brands including Stellantis (Fiat & Peugeot) and Michelin have reported that their plants have not been disrupted by this news. 

Uncertainty for the rest of the European Union 

While Poland and Bulgaria are securing other sources of natural gas, there’s uncertainty surrounding the potential impact of larger cutoffs or dramatic price increases. Especially if natural gas is cutoff from Germany or Italy, disruptions could occur. 

German carmaker Mercedes-Benz’s CFO Harald Henn remarked that while their plants in Poland, Hungary and Germany are unaffected, they remain dependent on gas for heating production halls and running paint shops. 

Mitigate Supply Chain Risk by Monitoring Critical Situations 

It is important to maintain a close eye on manufacturers and businesses as they respond to events that may impact the global economy. In particular, we are monitoring businesses and fab sites that are located in Russia or Ukraine, or closely related to those countries to help you understand how your business may be affected. 

SiliconExpert’s P5 Supply Chain Risk Management tool not only monitors critical events around the globe, but also provides predictive intelligence on pricing, lead time, and inventory.