OGZPY - Gazprom to allow Hungary to delay Euro1.9B in gas payments - Bloomberg

Gazprom ( OTCPK:OGZPY ) will grant a deferral of ~€1.9B on gas payments during the heating season to Hungary, one of the most reliant European countries on Russian energy, Bloomberg reported Tuesday.

The Hungarian government said Monday it had won a three-year reprieve from Gazprom ( OTCPK:OGZPY ) on payments coming due in the six-month period, without disclosing the terms of the deal.

Hungary will pay 20% of the amount in the first year that will be rolled over to pay 40% each in the subsequent two years, according to the report, which adds that the amount to be rolled over carries an interest rate equivalent to Hungary's three-year international sovereign debt in mid-September, which was ~3.5%.

The country reportedly would wind up paying ~€4B or more for Russian gas during the European winter, not counting the estimated €1.9B deferred amount.

Hungary is one of the few European Union countries still receiving Russian gas after Vladimir Putin cut off supplies to much of the continent in retaliation for sanctions over the invasion of Ukraine.

European natural gas prices have been dropping in recent weeks to the lowest since July as mild weather and ample stockpiles ease concerns about shortages .

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