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Buying rubles from his central bank: Putin is forcing us to break our own sanctions

Buying rubles from his central bank: Putin is forcing us to break our own sanctions

Clever move from Moscow: Due to Western sanctions, payment transactions with Russian financial institutions were stopped. Now Putin is forcing all EU states and gas customers to buy rubles from the Russian central bank in order to be able to pay for gas deliveries.

editorial staff
24 March 2022 09:33

Vladimir Putin’s decision to allow only rubles as payment for Russian gas supplies from next week came as a surprise. However, since this is not an international key currency that is stored by other countries, there is almost only one source for it: the Russian central bank.

However, like the other financial institutions in the country, this was excluded two weeks ago from payment transactions with most of the gas-buying countries and its reserves were frozen. This not only puts the boycott into question, but also strengthens the ruble, which recently fell. Will the “cold turkey” of Russia’s gas come faster than some Greens would like?

OMV wants to continue paying in euros

This would have catastrophic consequences for the national economies and would lead to billions of euros in damage, since short-term compensation from other suppliers is not possible.

OMV reacted very surprised to the latest decision and wants to wait for more detailed information: “No one has called us yet, we also have existing contracts, so it is not agreed that way. I’ll just wait and see if someone comes up to us,” said OMV General Manager Alfred Stern in an interview and assumes that he will be able to continue to pay in euros for the time being.

Who gives in first?

In addition, the availability of so many rubles is limited, although the central bank could “reprint” at any time. As a reaction to the Western measures, Vladimir Putin had already announced at the beginning of March that his own financial obligations to “unfriendly states” would only be settled in rubles. He was only able to service the last interest payments in US dollars with difficulty.

The nerve game continues, the ruble was able to increase again on the stock exchanges.

Putin’s decision stabilized the Russian currency again

Are you for a gas boycott?

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