Payment of Russian gas in rubles: Moscow’s “counter-sanctions” – Economic policy

Vladimir Putin’s decision to ban “enemy countries” from paying for Russian gas in dollars or euros could help “de-dollarize” the hydrocarbon market, but implementation remains very uncertain, says energy specialist Nicolas Mazzucchi, a researcher at the Foundation for Strategic Research ( FRS), a French think tank.

In addition to the risk that the decision will be equated with a breach of contract, as several analysts and the federal government emphasized on Wednesday, the difficulties relate to pricing and the selection of intermediary banks.

Besides the risk that the decision could amount to a breach of contract, as several analysts and the federal government pointed out on Wednesday, the difficulties concern pricing and the choice of intermediary banks to pay for hydrocarbons in dollars or euros.” It’s a bit like the Russian ones Counter-sanctions, which we expected, because we must remember that Russia imposed counter-sanctions when there was a component of sanctions against Russia in 2014, especially on issues of importing European processed agricultural products, so somewhere Russia sets up its counter-sanctions and hits to where it matters. What can the consequences be? If it works, two effects: It will artificially trigger the ruble, as this will create demand for the ruble, which will be affected by this Russian decision, this war in Ukraine to begin with . Second interesting E effect (for Russia), from the moment we +dedollarize+, in one way or another, makes it possible to avoid, for a large part, in whole or in part, the American sanctions that could be aimed at the use of the dollar from The extraterritoriality of American law is based on the dollar. By +de-dollarizing+ we are attempting to eliminate the American printing capacity. Regarding Iran in particular, all the United States had was to prevent Iran from trading, i.e. + you are forbidden from trading in dollars +. And since everything in the oil and gas world is currently done in dollars, saying: + now it’s not the dollar anymore, it’s not the euro anymore + maybe Moscow can hope to circumvent certain sanctions Companies are affected by this decision ?” Everyone who will buy hydrocarbons directly in Russia. So far we had TotalEnergies; (the group) had announced the end of oil and petroleum products, but gas will remain … We have Engie, on gas, there too everything with has to do with Nord Stream (of which it owns 9%). Until now, in a contract like Nord Stream, gas amounts have been stated in dollars. It’s X dollars per 1,000 cubic meters. The question is, from when Russia enters a want to introduce a system based on the use of the ruble, how do we convert this amount in dollars into an amount in rubles, what reference value will we take ? (…) We will have to see how it will be implemented. What is the reality of the implementers ung out, will it be necessary to go through certain banks? If so, these are banks that no longer necessarily have the capacity to operate on European territory, do we then have to go through third countries? This may be case by case, each player, if he wants to continue trading hydrocarbons with Russia, can implement his own strategy and circuit, there will not necessarily be a single model.

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