Russia will cut off gas supplies to even more countries if they don’t pay in rubles, as stipulated in a decree by Russian President Vladimir Putin, Kremlin spokesman Dmitry Peskov said on Wednesday. This morning the supply of Russian natural gas to Poland and Bulgaria was interrupted.
That has nothing to do with blackmail, Mr. Peskov replied to the statements made by the President of the European Commission, Ursula von der Leyen. According to the spokesman, in response to “unprecedented hostile action” taken by European countries. These measures were taken after the invasion of Ukraine by Russia.
New payment mechanism
The new payment mechanism will be defined in a presidential decree. It obliges companies to open two accounts with Gazprombank: one in foreign currency and the other in rubles. The Russian bank will then convert foreign currency payments into rubles before transferring the money to state-owned gas company Gazprom.
The European Union does not agree with this way of working. European companies willing to pay for Russian gas in rubles are violating EU sanctions and exposing themselves to legal risks.”behaved“warned Commission President Ursula von der Leyen.”Around 97% of the contracts (between EU companies and Russian gas suppliers) provide for payment in euros or dollars (…) Companies with such contracts must not give in to Russia’s demands, which would violate the sanctions“Imposed by the Twenty-Seven,” she added.
But according to the Kremlin, even more customers could be cut off from Russian gas if they don’t comply with the decree when making new payments. An unnamed Gazprom-related source previously told finance agency Bloomberg that it would be in the second half of May at the earliest.
The price of European gas rose sharply to over 120 euros on Wednesday morning after it was confirmed that Poland and Bulgaria would no longer receive gas. But then the price went down again. At around 1.30 p.m. Belgium time, the main Dutch TTF futures contract for gas with delivery in May was trading at around 107 euros, or 4% higher than on Tuesday evening.
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