Russia to ditch dollar in gas trade with ‘unfriendly’ countries

Russia’s President Vladimir Putin says the country will accept roubles instead of the dollar in its gas trade with “unfriendly countries,” referring to the countries that have imposed sanctions on Moscow over its military operation in Ukraine.

“Russia will continue, of course, to supply natural gas in accordance with volumes and prices … fixed in previously concluded contracts,” Putin said at a televised meeting with top government ministers on Wednesday.

“The changes will only affect the currency of payment, which will be changed to Russian roubles,” he said.

Russian gas accounts for some 40% of Europe’s total consumption and the European Union’s gas imports from Russia have fluctuated between 200 million to 800 million euros ($880 million) a day so far this year.

Putin said the government and central bank had one week to come up with a solution on how to move these operations into the Russian currency and that gas giant Gazprom would be ordered to make the corresponding changes to gas contracts.

Also on Wednesday, Russian Deputy Prime Minister Alexander Novak told Russia’s lower house of parliament that the European Union was experiencing “a rise in prices and a shortage of energy resources,” after putting a halt on the Nord Stream 2 gas pipeline under pressure from the United States.

Germany halted the Nord Stream 2 gas pipeline project, which was designed to double the flow of Russian gas heading direct to Germany, in response to Russia’s military campaign in Ukraine.

On February 24, Putin announced a “special military operation” aimed at “demilitarization” of the Donetsk and Lugansk regions in eastern Ukraine. In 2014, the two regions declared themselves new republics, refusing to recognize Ukraine’s Western-backed government.

Announcing the operation, Putin said the mission was aimed at “defending people who for eight years are suffering persecution and genocide by the Kiev regime.”