Bulgaria Imposes Tax on Russian Gas, Supply of South Europe Jeopardized

Bulgaria has imposed a tax on Russian pipeline gas supplied through its territory to the broader EU, according to a law published on the official website of the Bulgarian parliament on Friday.

The new regulation comes into force immediately and introduces a tax of 20 Bulgarian lev (USD 10.76) per megawatt-hour, or roughly 100 cubic meters, of Russian natural gas transited through the country.

The charge makes up about 20% of the current cost of gas futures at the Title Transfer Facility (TTF) hub in the Netherlands, Europe’s benchmark for the commodity. It closed at around EUR 55.1 (USD 57.9) per megawatt-hour on Friday, according to data from the London Intercontinental Exchange (ICE), Russia Today reports.

Until 2022, Russian energy giant Gazprom was one of the key suppliers of pipeline gas to Bulgaria. However, after the local authorities refused to pay for the fuel in rubles, direct exports to the Balkan country were halted.

While Bulgaria no longer imports gas from Russia for domestic use, it has remained one of the few routes for its delivery to the EU after flows shrank due to Ukraine-related sanctions against Moscow and the sabotage of the Nord Stream pipelines. According to Bloomberg estimates, roughly half of Russian pipeline gas destined for the EU currently goes through Bulgaria, entering via the TurkStream pipeline.

Experts warn that Bulgaria’s new tax could jeopardize supplies to a number of Southern European countries, including Hungary and Serbia, which continue to rely on Russia for most of their gas needs. Hungarian Foreign Minister Peter Szijjarto called the measure “unacceptable.” He added that both Hungary and Serbia are already taking steps to ensure that Bulgaria cannot apply the legislation to their gas imports.

Gazprom has not yet commented on the development, nor responded to media requests for its reaction.

Bulgarian parliament

Ministry of Foreign Affairs of Hungary

Gazprom

Peter Szijjarto

TTF hub

tax on Russian gas