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Russia will stop gas exports if payments are not made in rubles

Russia will halt gas exports to so-called “unfriendly” countries from Friday unless they comply with his order to make payments in rubles, Russian President Vladimir Putin warned on Thursday as Moscow scrambles to shore up its economy.

“To buy Russian natural gas, they need to open ruble accounts in Russian banks. Payments for gas delivered starting tomorrow will be made from these accounts,” Putin said in a televised address to Russian officials.

“If such payments are not made, we consider this as a default on the part of the buyer with all the consequences that ensue. Nobody sells us anything for free, and we won’t do charity either – meaning existing contracts will be stopped,” he added.

Protester against Russian oil and gas
Russia supplies a significant part of Europe’s gas needs.
Getty Images

Buyers are instructed to transfer their payment to accounts they have set up with a Russian bank, which will convert their currency into Russian rubles, which will then be used to complete the transaction. Western officials have argued that the ruble requirement is a violation of existing contracts that specify payments in euros or dollars.

Putin’s policy has major implications for Europe, where many countries rely heavily on Russian oil and gas to generate electricity and heat their homes. Russia supplies about 40% of Europe’s gas needs, with any disruption likely to trigger an energy crisis.

The strained deal has complicated efforts by western nations to increase economic pressure on Russia, which derives a sizable chunk of its annual revenues from oil and gas exports. Unlike the US, the European Union has not included an import ban in its sweeping sanctions against the Kremlin.

Wladimir Putin
Vladimir Putin said countries have until April 1 to meet the ruble requirement.
via REUTERS

The ruble requirement for gas purchases is one of several moves Russia is taking to retaliate against sanctions-imposing nations — and to strengthen its own currency.

The Kremlin is trying to stabilize the ruble, which has tumbled alongside Russia’s main stock exchange in recent weeks after it imposed penalties including banning Russian banks from the international SWIFT payments system.

The ruble has since recovered almost to its pre-invasion Ukraine value as Russia mandates ruble payments and its central bank imposes exchange controls.

With postal wires

https://nypost.com/2022/03/31/putin-russia-ending-gas-exports-if-payments-not-made-in-rubles/ Russia will stop gas exports if payments are not made in rubles

JACLYN DIAZ

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