The chemical company BASF has warned of the drastic consequences of a possible gas embargo from Russia.

If gas supplies were to be cut in half, the Ludwigshafen plant – the largest chemical site in the world – would have to shut down.

The group explained on the occasion of its investor day that there would then be a significant impact on the basic needs of the population, not only in Germany and thus on the community.

CEO Martin Brudermüller said there was no way to replace Russian gas in the short term.

The group is working intensively on reducing its dependency on gas.

However, this is not possible in the short term.

Bernd Freytag

Business correspondent Rhein-Neckar-Saar based in Mainz.

  • Follow I follow

Michael Vassiliadis, chairman of the IG BCE chemical union and a member of the BASF supervisory board, told Deutschlandfunk in the morning that if the gas supply was less than 50 percent, a Verbund site like Ludwigshafen – where almost 40,000 people work – could no longer be operated stably, so it would have to be shut down completely .

"Everyone would go on short-time work or lose their job." If there were no compensation for Russian gas, the effects on the chemical industry would be dramatic, he said. The failure would "cost hundreds of thousands of jobs over a relatively short period of time" and affect the affect supply.

If the gas quantities were "only" significantly restricted, the group would be forced to reduce the production of important basic chemicals and downstream products.

All downstream customer industries are affected.

The processing industry would have to restrict "the production of many important substances of daily use".

Consequences for customers from the automotive, pharmaceutical and construction industries

As an example, BASF refers to the production of ammonia, an important precursor for fertilizers.

Russia is a major exporter of ammonia and fertilizer and has already threatened to restrict exports.

"A reduction in the gas supply in Germany would further exacerbate the shortage of fertilizers worldwide, reduce food production and further increase the prices of staple foods."

According to BASF, a reduction in acetylene production would also mean significant restrictions.

Acetylene is an important raw material for many everyday products such as plastics, pharmaceuticals, solvents and textile fibers.

A reduction in production would be felt by downstream customers from the automotive, pharmaceutical and construction industries.

This is the first time that BASF, as the industry leader, has publicly commented on the consequences of a possible import ban from Russia.

After the G-7 countries rejected Vladimir Putin's demand on Monday that gas bills should only be paid in rubles in the future, an end to imports is likely to come closer.

BASF CFO Hans-Ulrich Engel said that BASF itself purchases the gas from a European supplier and is therefore not forced to pay in rubles.

However, what will happen if the supplier has to pay in rubles cannot be estimated today.

The group does not quantify the exact share of Russian gas in gas requirements.

The subsidiary Wintershall Dea – a co-financier of Nord Stream II – produces gas in Siberia itself.

According to a Wintershall spokesman, however, the gas is sold locally to the energy giant Gazprom - so the Russians themselves take care of the resale to Europe.