Russian company Gazpromtrans stops accepting orders to ship LPG to Ukraine

Gazpromtrans, the subsidiary of Russian gas monopoly Gazprom in charge of rail shipments, stopped accepting orders to transport liquefied petroleum gas (LPG) to Ukraine from February 18, according to a note sent to its clients and seen by Reuters. .

The note cited rising political tensions between Russia and Ukraine for the move.

“Due to the escalation in Ukraine and to avoid possible risks (such as) damage to railway cars owned by Gazpromtrans… the company has to suspend receiving orders for shipment of volumes to Ukraine from February 18 until further notice. warning”, the note said.

The company asked its customers to consider other destinations for their supplies. Gazpromtrans did not respond to a request for comment on the note.

Tensions over a surge of Russian troops near Ukraine’s borders have risen sharply since Russian President Vladimir Putin signed decrees on Monday recognizing the independence of the Luhansk and Donetsk regions, controlled since 2014 by separatists. pro-Russian

The company said in the document that it will honor orders already placed and confirmed, but asked for full compensation if any damage to its property occurs during deliveries.

Most of Gazpromtrans’ supplies of LPG to Ukraine are spot sales, or for immediate delivery, two traders familiar with the supplies said.

Spot demand is currently low due to seasonal factors as most winter orders have already been filled through forward contracts, but if the situation persists into March or April, some LPG supply shortages could be noted in the Ukrainian market, they added.

In 2021, Gazpromtrans shipped 64,000 tons of LPG to Ukraine, about 10.7% of all Russian supplies of the fuel to the country, according to rail shipment data from Refinitiv Eikon.