Putin demands payment in rubles already on Friday

Putin said Russia will suspend all gas contracts if buyers in “hostile-minded” countries do not pay rubles from April 1.

Heavy importing countries have described such requirements as a breach of contract.

But according to a decree of the Kremlin, after April 1, it will still be possible to pay in foreign currency, such as euros or dollars, as long as you agree to open accounts in rubles at Gazprombank of Russia.

The bank, in turn, must exchange the paid foreign currency for rubles – after which the official purchase takes place.

– From these accounts gas will be paid as of April 1. Putin says if these payments are not made, we will consider that the customer has not fulfilled his obligations.

He adds that if the new Russian requirements are followed, Russia will continue to supply natural gas in the agreed quantities and prices.

Crisis planning

French Finance Minister Bruno Le Maire comments on this step after meeting his German counterpart Robert Habeck in Berlin.

– Perhaps tomorrow there will be no Russian gas. Our job is to prepare for these situations, says Le Maire, and that’s what we’re doing now.

German Chancellor Olaf Schulz confirms that payments for Russian gas can be made in euros or dollars, after reconsidering the agreements.

– I was clear in my conversation with the Russian President that this is the way it will continue. What he has in mind about what’s going to happen is something we’ll take a closer look at. Regardless, companies that want to pay in euros can and will continue to do so, Schulz says at a press conference.

To be exchanged in Russia

On Wednesday night, Schulz and Putin had a conversation in which Putin, according to the German government, eased his ultimatum on what applies to Russian natural gas in rubles.

Putin reportedly said that European buyers could continue to pay for Russian gas in euros to Gazprombank, which in turn could exchange money for rubles.

Italian Prime Minister Mario Draghi said earlier on Thursday that the final message from Russia is that the request to convert to the ruble will now be made in Russia.

Previous allegations reported

The G7 countries unanimously rejected Putin’s previous demands for rubles for Russian gas, and in Germany – one of the European Union countries most dependent on Russian gas – a crisis plan was triggered that could at a later stage mean legalization and industrial closure.

Putin launched a proposal to claim rubles for Russian gas last week. It targets what he describes as 48 “hostile” countries, including major consumers in the European Union. The request was rejected by the German side, among other things, as the majority of current supply agreements refer to the euro as a means of payment.

But according to Putin’s spokesman Dmitry Peskov, no modifications to existing contracts are required to implement Putin’s requirements, whether in terms of currency or other terms such as prices, volumes and delivery times.

– In any case, they will only need to buy the ruble with the currency that applies in the delivery agreement, says Peskov.