“Open and transparent scheme”
Today a decree outlines the rules for trading Russian gas with countries deemed unfriendly. The plan promotes openness and transparency for counterparties from those nations. For purchases of Russian gas, a ruble account in Russian banks will be required, according to the official statement.
These ruble accounts are intended to cover gas deliveries starting from April 1. If payments are not made, the buyers will be deemed to be in default, with all accompanying consequences. Contracts are not free, and the existing arrangements will be halted if terms are not met.
The president noted that when Western financial systems are used as leverage, and Western banks and currencies are frozen, relying on dollars and euros for payments becomes impractical. Moving to ruble-denominated payments with Western gas buyers is described as a move to bolster financial and economic resilience.
The president stressed that the steps aim to reduce risk and strengthen sovereignty over the financial system. He asserted that Russia remains a responsible supplier and will continue to deliver gas according to current contract volumes and prices, which he described as well below current market levels. The shift is framed as a strategic move to reduce exposure to external financial pressures.
He added that the strategy is a necessary response to unacceptable risks in the present situation and that transferring gas payments to the ruble is a step toward greater economic sovereignty and financial stability.
Putin also claimed that Russia will maintain gas supply at contracted volumes and pricing, suggesting that the current price levels are a benefit in the spot market as opposed to larger market trends.
“It can’t go on like this”
There is a belief that Western strategies aim to push Europe toward expensive American LNG, which would undermine European company competitiveness. In addition, he argued that global markets are volatile, with capital flowing to the United States and diminishing development resources elsewhere. The shift to more costly LNG is said to threaten European market positions and broader global competitiveness.
The stance includes the assertion that the West is obtaining some Russian gas through free arrangements due to the freezing of Russia’s foreign currency accounts. The speaker suggested that Europe has benefited from Russian gas while paying in euros, but that recent freezes complicate this dynamic. The potential for future gas deliveries to be paid under current plans is described as carrying risk of new financial gains being blocked in euros or dollars.
The narrative notes that Western politicians have publicly discussed these issues and that government leaders in the European Union have expressed related concerns about the financial arrangements involved in gas trade.
presidential decree
The decree, published on the Kremlin site, assigns Gazprombank the task of opening special ruble accounts for foreign buyers from hostile countries. It will also facilitate the sale of foreign currency for conversion into rubles to pay for natural gas at auctions on the MICEX-RTS platform.
The Board of the Central Bank of the Russian Federation is empowered to set up the regime for special ruble and foreign currency accounts and to determine the procedures for selling foreign currency. The Central Bank will define how foreign currency accounts for gas buyers are opened within ten days.
The Government Commission on Foreign Investments holds authority to authorize foreign buyers to fulfill their payment obligations to Russian suppliers without strictly following the decree’s procedures.
German refusal
German Chancellor Olaf Scholz stated after the decree that gas payments to Russia have traditionally been made in euros and dollars and would continue to be so. He emphasized that contracts specify payments in euros, with some instances in dollars, and asserted that this arrangement will remain in place. He noted that although dependence on energy resources may be reduced quickly for some fuels, gas will take longer to shift away from traditional currencies.
France also signaled that it would not accept ruble-based payments for Russian gas. French officials reiterated a stance that contracts are clear about payment currencies and must be strictly adhered to. Following the decree, reports from London suggested that European gas prices rose in response to the development.