Nervousness in the gas market in the wake of the Putin decree

LAST UPDATE: 18:48

Nervousness prevails in the gas market in the wake of Russian President Vladimir Putin’s decree that buyers from “friendly” countries must pay in rubles for Russian gas from April 1 and their contracts will be terminated if they are not fulfilled. the payments.

“In order to buy Russian gas, they have to open ruble accounts in Russian banks. From these accounts will be made the payments for the gas that will be delivered from tomorrow,” Putin said, according to Reuters.

“If these payments are not made, we will consider it a default on the part of the buyers, with all the consequences. No one is selling us anything for free, nor are we going to do charity – that is, the existing contracts will be terminated,” he added.

Buyers will have to open special accounts at state-owned Gazprombank to allow the exchange of foreign currency into rubles for settlement. [των συναλλαγών]according to the decree signed by Putin, Bloomberg reports.

The news temporarily pushed the price of natural gas in Amsterdam close to 127 euros per megawatt hour, to then fall, but in May it traded in a range between 120 and 125 euros.

Putin’s decision to make ruble payments for gas has strengthened the currency, which plunged to historic lows when the West adopted the first sanctions against Russia for invading Ukraine, Reuters reports.

However, Western companies and governments have rejected the move, saying it violates existing contracts, which have been made in euros and dollars.

Putin said the decision to make payments in rubles was aimed at strengthening Russia’s national sovereignty, adding that Moscow would continue to fulfill its contractual obligations. Russia supplies about a third of Europe’s gas demand.