The EU is drafting a plan to pay for Russian gas without violating sanctions, experts say

The EU gets around 45% of its gas imports from Russia. (Image: Getty)

Oil, chemical and petrochemical refinery plant abstract

The EU gets around 45% of its gas imports from Russia. (Image: Getty)

  • The EU plans to allow member states to open accounts with Gazprombank, according to Bloomberg.
  • Putin has threatened to cut off gas supplies to “unfriendly” nations that do not pay in rubles.
  • Some members, including Poland, said the plans lacked legal clarity.
  • For more stories go to www.BusinessInsider.co.za.

The European Union (EU) is drafting a plan to meet Russian President Vladimir Putin’s demands to pay for the country’s gas in rubles without violating sanctions, sources told Bloomberg.

Sources attending a closed-door meeting of the European Commission on Friday said the new guidance would allow gas importers to open a Russian state account at Gazprombank and pay in euros or dollars, which the bank would then convert into rubles.

According to Bloomberg, the sources said that companies should make “a clear statement that they consider their obligations fulfilled once they pay in euros or dollars, in accordance with existing contracts.” The commission did not immediately respond to Insider’s request for comment outside of normal business hours.

Putin is pushing for “unfriendly” countries to pay for gas in rubles to maintain the strength of a currency that is being propped up by strict capital controls and high interest rates, threatening to cut a line that supplies 45% of imports. EU gas. .

The commission is now trying to find a way to meet Putin’s demands without technically violating the sanctions, with an indication that paying into a Gazprombank account in euros or dollars would be legally correct.

Buyers must open two accounts with Gazprombank: one in domestic currency and one in foreign currency. Paying in the national ruble would violate the sanctions, although the sources said it was unclear whether the updated guidance would change this.

The sources previously said that 20 companies have already set up accounts with Gazprombank to meet Putin’s demands. European Commission President Ursula Von Der Leyen described the demands as “blackmail” and “a clear breach of contract”.

One of the sources told Bloomberg that Germany, Hungary, Italy and France were broadly in favor of the plan, while Poland said it offered no legal clarity and others were confused by a lack of specific guidance.

Most EU countries have payment deadlines with Russia for gas imports at the end of the month, at which point failure to meet Putin’s demands could lead to taps being cut, as happened with Poland and Bulgaria in april.

The bloc is reportedly preparing a 195 billion euro (3.3 trillion rand) plan to stop using Russian fossil fuels by 2027, according to draft documents seen by Reuters.

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