Vladimir Putin blocks transfer of energy exports to 'unfriendly' states unless paid in rubles

Mikhail Klimentyev, Sputnik, Kremlin Pool Photo via AP

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Russian President Vladimir Putin has signed a decree to block the transfer of energy exports to “unfriendly” states unless they switch to payments in rubles following April 1.

The move is the latest strike in Russia’s struggle with Europe over energy sales, which was prompted by the country’s “special military operation” in Ukraine.

“To buy Russian gas, they need to open ruble accounts in Russian banks,” Putin told officials in a televised speech Thursday, Bloomberg reported. “It is from those accounts that gas will be paid for starting April 1. If such payments aren’t made, we will consider this a failure by the client to comply with its obligations.”

According to Russian state media, buyers should open special accounts in Russia’s state-run Gazprombank to enable the foreign currency to be swapped into rubles for settlements, an order signed by Putin on Thursday.

The move is a marked departure from Putin’s statements on Wednesday, in which he said that Russia would continue to supply gas to Europe, even as it demands customers pay in rubles.

In response to Russia’s decree, German Economy Minister Robert Habeck rejected the demand, calling it an “unacceptable breach of contract,” adding that the maneuver amounted to “blackmail,” Reuters reported.

Speaking at a press conference with his French counterpart, Economy Minister Bruno Le Maire, Habeck said, “With regard to the threat, demand or consideration — one doesn't know what to call it anymore — to be made to pay in rubles, it is crucial for us that the contracts are respected.”

“It is important for us not to give a signal that we will be blackmailed by Putin,” he added.

“By all means, it remains the case that companies want, can and will pay in euros,” added Austrian Karl Nehammer.

“The last sanctions package must not and should not be the last. We spoke about what additional sanctions can prevent Putin from continuing the war in Ukraine,” Habeck said.

Reuters reported:

Scholz also raised the possibility of new sanctions on Russia over its invasion of Ukraine, adding that Germany was prepared for all scenarios, including a stoppage of Russian gas flows to Europe.

Scholz reiterated that Germany hoped to become independent of Russian oil and coal imports this year, but it would take longer to reduce its dependence on Russian gas.