sanctions
EU: Ruble exchange for gas payments is a matter for Russia
View of the Lakhta Center business tower, the headquarters of the Russian gas monopoly Gazprom. Photo: Dmitri Lovetsky/AP/dpa
© dpa-infocom GmbH
The dispute over payment for Russian gas supplies escalated this week. Now the EU Commission is clarifying how companies can continue to pay for gas without violating the sanctions. Russia still gets rubles.
The European Commission has clarified regulations on the ruble payment required by Russia for gas deliveries.
Companies that opened a bank account in Russia and continued to pay for supplies in euros, as requested by Moscow, did not violate EU sanctions against Russia, EU Commission officials said on Thursday. “What the Russians do with the money afterwards is up to them,” said one official.
However, the EU Commission does not consider it acceptable that the purchase by Russia is not considered complete until the money has been converted into rubles. “It would be a violation of sanctions for a company to accept opening a second account to meet demands,” said an EU official. During the currency exchange in rubles on the second account, the money is in the hands of the Russian central bank, which is sanctioned by the EU.
The regulation thus stipulates that EU companies cannot formally be held responsible for the ruble exchange – but does not prevent Russia from exchanging the money afterwards. According to a spokesman, Germany’s largest importer of Russian natural gas, the energy group Uniper, is examining the possibility of paying for Russian natural gas in euros to an account in Russia. Uniper believes that there could be a solution to the question of how the funds could then be converted into rubles: “But there is still no final solution.”
Germany must be prepared for a gas supply stop
Chancellor Olaf Scholz (SPD) said in Tokyo that Germany must be prepared for a Russian gas supply stop. “One can only speculate whether and what decision the Russian government will make in this regard, but it makes little sense,” said the Chancellor. “You have to prepare for it.” Economics Minister Robert Habeck (Greens) said on Wednesday that German energy companies would pay in euros, and Gazprombank would then convert the money into rubles. It is open how Russia interprets its decree on gas payments.
At the end of March, Kremlin chief Vladimir Putin demanded that Western countries open accounts with Gazprombank in Russia effective April 1 in order to pay for Russian gas. Otherwise, deliveries to the “unfriendly” countries would be stopped. According to a decree signed by Putin, payments can still be deposited into the Russian account in euros or dollars. Gazprombank converts the money into rubles and transfers the amount in Russian currency to Gazprom. If the payments were not made, deliveries would be stopped, Putin had threatened.
Gas deliveries to Poland and Russia stopped
Russia stopped gas supplies to Poland and Bulgaria on Wednesday after the two countries failed to agree to the new payment system. According to Gazprom, the reason is that the companies PGNiG and Bulgargaz did not pay in rubles on time. Sofia and Warsaw, on the other hand, emphasized that they had fulfilled their obligations.
According to information from the EU Commission, both countries wanted to process their due invoices as before the war. According to officials, most of the purchases so far have been made through accounts at Gazprombank in Luxembourg. Accordingly, around 97 percent of gas contracts in the EU are denominated in dollars or euros. According to Gazprom on Thursday, Poland continues to get Russian gas through Germany.
The EU Commission also said it had no information that European companies had already opened a second Russian account in rubles and were thus violating the sanctions. One is in exchange with the companies and EU countries. In principle, it is up to the member states to ensure that the sanctions are complied with, said a Commission spokesman.
Uniper: Do not violate sanction rules
According to the spokesman, Uniper is certain that payments will continue to be made in euros. You will not violate sanction rules. Talks are being held with Gazprom about the method of payment. There is also coordination with the federal government and with other companies in Germany and Europe. In the next 10 to 14 days, the question of the payment method will have to be resolved. The next payments to Gazprom by Uniper are scheduled for the end of May.
Uniper CEO Klaus-Dieter Maubach had previously said that the company was preparing to pay using the “two-account solution”. “That means we continue to pay in euros and an immediate conversion into rubles takes place, orchestrated by Gazprom Bank. The Russians then say that we paid in rubles, so we’ll have to live with that. The procedure has been discussed intensively with the federal government,” he told the “Frankfurter Allgemeine Zeitung” (Thursday).
Ifo President Clemens Fuest assumes that Russia will continue to supply energy. “From an economic point of view, I would say that Russia has an urgent interest in continuing to sell us gas,” he told the news portal t-online. “After all, it’s about a lot of money – and the income should even grow.” Due to the delivery stop for Poland and Bulgaria, global gas prices are likely to rise again, at least temporarily.