Gas Crisis in Moldova: Causes and Consequences

Abstract

The article discusses the causes of the gas crisis in Moldova and the peculiarities of its course. It is emphasized that the gas crisis has not only economic reasons related to Moldova’s high energy dependence and Gazprom’s desire to make super profits due to favorable conditions in the global gas market. The crisis demonstrated that the pro-Western Moldovan leadership, once again, neglected the economic interests of their country for the sake of geopolitical considerations. This situation has become possible due to the fact that Moldova is now, to a large extent, under external control. The article analyzes the specifics of the negotiation process regarding the terms of the renegotiation of the gas contract, the positions of the management of Gazprom and Moldovagaz. The unconstructive nature of the Moldovan leadership’s claims for substantial discounts on Russian gas supplies is emphasized.

As a result, the formula for purchasing Russian gas for Moldova turned out to be tied to the prices of oil basket goods and market prices for gas, which led to a significant increase in its cost. This circumstance led to a sharp increase in gas prices and an increase in tariffs for end consumers in Moldova, which led to an increase in the price of essential products, including fuel. The rapid decline in the living standards of the Moldovan population has led to an increase in social tension and the intensification of the protest movement. At the same time, judging by recent events, the Moldovan leadership has not learned the necessary lessons from the situation. The next trigger that can cause a new round in the gas crisis in Moldova may be a conflict caused by the different approaches of the contracting parties to the audit procedure of Moldovagaz and, accordingly, to determining the size of Moldova’s gas debt.