As Russia Cuts Gas, Europe's Largest Energy Company Requests Bailout

[Asia Economy Reporter Bu Aeri] Due to the reduction in natural gas supply from Russia, Uniper SE, one of Germany's largest energy companies and one of the largest in Europe, has requested a bailout from the government.

Uniper is an energy company that produces electricity across Europe and trades gas globally.

According to the U.S. Wall Street Journal, Uniper is in discussions with the German government and the state-owned development bank KfW to increase the credit loan limit, including equity investments and other financial stabilization measures.

As Europe's largest purchaser of Russian gas, Uniper has been receiving only 40% of the gas it ordered since mid-last month due to Russia drastically reducing gas supplies amid controversies over resource weaponization targeting the West.

To cover the shortfall, Uniper is purchasing gas on the spot market at higher prices.

While these additional costs should be reflected in gas prices, the German government has limited gas price increases considering soaring inflation, severely deteriorating Uniper's profitability.