(Reuters) – Kremlin-controlled Gazprom (MCX:)’s fuel exports to Europe may fall by round a 3rd this 12 months as a result of disaster in Ukraine, rivalry with liquefied , and plans to change to rouble funds, analysts mentioned on Friday.

Russia accounts for round 40% of European fuel provide, however the West has been attempting to wean itself off Russian vitality flows with rising urgency because the nation started what it calls its “particular navy operation” in Ukraine on Feb. 24.

Plans to cost “unfriendly” international locations for fuel gross sales in roubles have additionally undermined prospects for Russian fuel exports, analysts mentioned, as Europe mentioned this amounted to “blackmail” and virtually unanimously refused to conform.

Sergei Kapitonov from the Vitality Centre at Moscow’s Skolkovo College of Administration mentioned Gazprom provides to Europe might fall by 40 billion-45 billion cubic metres (bcm) this 12 months from round 150 bcm in 2021.

Sindre Knutsson, head of fuel market analysis at Rystad Vitality, mentioned pipeline volumes can drop even additional, “pushed by a push from patrons to turn into much less reliant on Russia, or by Russia holding again volumes, for instance pushed by a disagreement on which forex the fuel ought to be paid in”.

He additionally did not rule out a stoppage in flows via Ukraine if the battle prevents pipeline operations from persevering with safely.

Gazprom has not disclosed its expectations for fuel exports to Europe. The corporate didn’t reply to a request for remark.

Prime shoppers of Gazprom’s fuel in Europe in 2021 had been Germany, which took 45.8 bcm, Italy, taking 20.8 bcm, and Austria, which obtained 13.2 bcm.

Russia is Germany’s prime provider, delivering slightly below a 3rd of its fuel, whereas Italy will get some 40% of its imported fuel, and Austria 80% of its pure fuel, from the nation.

To this point, solely Hungary has agreed to maneuver to the gas-for-roubles scheme, which includes patrons making international forex funds via Russia’s Gazprombank, which might subsequently convert it into roubles.

An inside European Fee be aware mentioned final week that fee for Russian fuel in roubles by European Union patrons would break the EU’s sanctions regime in opposition to Moscow.

Alexei Gromov of the Institute for Vitality and Finance Basis mentioned Russian pipeline fuel could possibly be partially supplanted by sea-borne liquefied pure fuel from america and from Russia’s Novatek, which doesn’t need to cost shoppers in roubles.

Gromov mentioned Russian pipeline fuel exports to the European Union might attain some 105 bcm this 12 months.