UPDATE: Putin: West to open ruble accounts with Russian bks for gas

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MOSCOW, Mar 31 (PRIME) -- The Western countries and other states from the list of unfriendly states will have to open ruble accounts with Russian banks to buy natural gas for rubles starting from April 1, President Vladimir Putin said on Thursday during a government meeting that discussed the aviation industry.

“I have signed a decree today that settles the rules of selling Russian natural gas to the so-called unfriendly states,” he said.

“We suggest a clear and transparent mechanism for counteragents from these countries. To buy Russian natural gas, they have to open ruble accounts with the Russian banks. Payments will be done using these accounts for the gas supplied starting from tomorrow, April 1.”

Putin’s spokesman Dmitry Peskov told reporters earlier that following Wednesday’s conversation with German Chancellor Olaf Scholz about the mechanism, Putin ordered his economic advisor Maxim Oreshkin to talk to his German counterpart Jorg Kukies and explain work of the ruble mechanism in detail, Peskov said.

“Like we’ve said previously, there will be no changes for the receivers of Russian gas that pay for the supplies. In any case, they will buy rubles with the currency mentioned in the contract. Russia complies with all liabilities under all existing contracts in regards to the amount and prices,” he said.

One of the options for all the unfriendly states is to pay to Gazprombank, which was not hit by the Western sanctions, and the bank will then convert foreign currencies into rubles, he said.

On Wednesday, the German government spokesperson Steffen Hebestreit said following the negotiations between Putin and Scholz that Germany will continue paying exclusively in euros to Gazprombank, which will convert them into rubles on its own.

“This is being considered,” Peskov said. This payment plan was suggested to all the unfriendly states, but details will follow, he said.

Italian Prime Minister Mario Draghi told reporters that Putin had told him on Wednesday that the Russian gas contracts in euros and U.S. dollars will still be in force, and that the European companies will continue paying in euros and U.S. dollars.

“I’ve just heard that technical workers are to contact each other after that to understand how it works … What I understood was that a switch of payments from euros and U.S. dollars to rubles is an internal Russian issue,” he said.

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