Belgium (Brussels Morning Newspaper) Russia appears determined to insist on receiving gas payments in rubles from “unfriendly countries”, with top Russian officials warning Moscow will stop delivering gas to countries refusing its terms.
The Kremlin announced on Tuesday that it would iron out all practical arrangements for the switch to roubles by Thursday, following on President Vladimir Putin’s order made last week to force all foreign companies in western countries to pay for their gas in roubles. The goal of such an effort is likely to prop up the rouble, as western sanctions have frozen a huge chunk of Russian central bank’s foreign reserves.
“No one will supply gas for free,” warned the Kremlin spokesman Dmitry Peskov on Tuesday. “It is simply impossible, and you can pay for it only in roubles!” Completing the threat to western nations, speaker of Russia’s upper house, Valentina Matviyenko, announced that Moscow was ready if Europe refused to buy Russian energy. Matviyenko noted Russia could redirect its supplies to Asian and other markets.
A vast majority of gas delivery contracts in Europe stipulate payment in euro, and EU countries insist that Russia is not legally allowed to make one-sided changes to existing agreements. The G7 group of world’s richest democracies likewise rejected Putin’s demand for payment in roubles earlier this week.
The G7 urged companies not to bow down to Russian demands, stressing that most supply contracts already stipulate payments in euros or dollars. Speaking at a news conference in Brussels on Tuesday, a European Commission spokesperson confirmed that the EU executive shares this sentiment.
The EC announced last week it was already considering worst-case scenarios that would include a complete halt in Russian gas deliveries before next winter, as part of its contingency planning to address supply shocks.