Why are EU energy firms agreeing to pay in roubles for Russia’s gas?
theguardian.comEnergy companies in Germany and Hungary have confirmed they intend to comply with Vladimir Putin’s demand that buyers of Russian gas pay for contracts in roubles. But the EU has warned there is a risk the companies would be in breach of sanctions prohibiting transactions with Russia’s central bank. The stakes are high, because the Kremlin has already switched off supplies to Poland and Bulgaria.
Putin said buyers from “unfriendly” countries must start paying for their gas in roubles. Usually, the vast majority of buyers would pay in euros or dollars. Their bill from Russia’s state energy group Gazprom would be deemed settled once the payment went through.
Under decree 172, which he issued in March, buyers have to take part in a new payment system that requires the opening of two accounts at Gazprombank.
Money would be paid into one account in euros and dollars before being converted by the bank into roubles and paid to Gazprom from the second account. Only at that point would the buyer be deemed to have fulfilled its legal obligation to pay for the gas.
Hungary has said it is happy with the plan and, according to reports, two of Europe’s biggest gas companies, Germany’s Uniper and Austria’s OMV, are also reportedly preparing for rouble payments, while Italy’s Eni is said to be considering it.
Until this week, it was unclear whether Putin would make good on his threat to cut off buyers who refuse his demand. But on Wednesday, Gazprom suspended gas supplies to Bulgargaz (Bulgaria) and PGNiG (Poland) after they declined to pay in roubles.
This is where it gets thorny. European leaders, including the European Commission president, Ursula von der Leyen, have said they would not do Putin’s bidding.
The EU’s preliminary analysis,
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