Central European and Balkan countries, especially Hungary and Serbia, are outraged at a recent Bulgarian decision to introduce an absurdly high transit fee on Russian gas transported through the country, saying that it could have detrimental effects on the region’s energy security, Euractiv reported on Monday, October 16th.
The new measure is part of a long line of Bulgaria’s strongly Euro-Atlanticist ruling majority’s anti-Russian regulations. It clearly states that only Russian gas would be subjected to the increased transit fees of €10,2 (20 leva) per MWh coming through the Balkan Stream—the Bulgarian section of the larger Turkish Stream gas pipeline.
The rationale behind the move is to further reduce Russia’s energy revenues to put an end to the war, no matter who’s caught in the crossfire. If the transit tax is not paid in time, the authorities said, Bulgaria will simply close the pipelines.
Sofia is expecting an additional income of €1.2 billion a year from the transit fee alone—or more than the price of Balkan Stream’s entire construction (€1.1 billion). Other estimates put the possible extra profit at up to €2 billion.
For those at the customer end of the line, the increased fee could have catastrophic economic consequences. Apart from Serbia and Hungary, Austria, North Macedonia, and Greece also rely heavily on the gas coming through the Balkan Stream, but this decision alone could put an end to the entire supply—it all depends on what Gazprom will do.
In fact, the law will only require the local transit company (Bulgartransgaz) to pay the extra fee to the state, but it would be allowed to outsource it to either the buyers or the supplier (Gazprom). The first option would instantly increase the price of gas in the region by €100 for every thousand cubic meters, while the second option would give Gazprom the same choice instead.
Then it would be up to the Russian energy giant to decide if it wants to increase its prices (and risk losing its competitiveness in Europe) or just accept less profit to be able to retain its customers. A third, and arguably the worst option could be if Gazprom suspended all gas supplies through the Turkish stream in protest while searching for friendlier markets.
Either way, the countries downstream expect “a drastic increase in the price of gas, [that] is a big problem for us,” Serbian President Alexander Vučić said. “This is appalling,” he added, saying he would open a dialogue with his Bulgarian counterpart, Rumen Radev, in an attempt to reverse the decision.
However, the conversation will hardly have any effect, since the Euro-Atlanticist government has been acting largely independently of the president ever since the broad coalition between the pro-European GERB-SDS and PP-DB came to power last spring. And on any issues relating to Russia, the coalition sticks to its hardline policies.
“Bulgaria decides on its own what fees to introduce for the transit of gas through its territory,” commented Venko Sabrutev, a member of the liberal, pro-European We Continue the Change (PP) party. “Hungary and Serbia should look for an alternative.”
Hungary, one of the most dependent on Russian gas in the region, immediately contacted Sofia to demand an explanation. “This is clearly unacceptable,” said Hungarian Foreign Minister Péter Szijjártó:
Having an EU member state jeopardizing the gas supply of another EU member state is quite simply against European solidarity, against European rules.
According to the members of the Bulgarian opposition party ABV, the extra transit fee does indeed violate the European treaties. They announced they would take the case to the Bulgarian Constitutional Court.
Although Szijjártó did not threaten it publically, many in Bulgaria—including former Constitutional Judge Georgi Markov—are expecting Budapest to veto Sofia’s Schengen accession as a result.
In a recent interview with the local daily Pik, Markov said that it was “obvious” that Bulgaria wants to punish Serbia and Hungary “on American orders,” and noted that the Bulgarian government didn’t even inform Budapest and Belgrade about what’s being planned.
“If the bill is adopted, I can say with certainty that Hungary will veto our country’s accession to the Schengen area,” Markov said. “After the favor to Biden and Soros, our way to Europe will not be via Belgrade, but via the Bosphorus, if President Erdogan lets us through.”
