A pressure gauge is pictured at a Ukrainian gas compressor station in the village of Boyarka near the capital Kyiv January 20, 2009. REUTERS/Konstantin Chernichkin
BRUSSELS – The European Commission said on Tuesday opening accounts in rubles at a Russian bank to pay for gas would violate the bloc’s sanctions against Moscow, after Brussels released updated guidance on how companies can legally continue to use Russian fuel able to buy.
Countries and companies have been demanding clarity on how to proceed for weeks after Moscow asked foreign buyers to pay for gas in rubles in late March or risk losing supplies.
In updated guidance sent to EU countries on Friday, the Commission confirmed its earlier recommendation that EU sanctions do not prevent companies from opening an account with a specific bank.
Businesses can pay for Russian gas – provided they do so in the currency stipulated in their existing contracts and declare the transaction complete when that currency is paid.
Almost all supply contracts between EU companies and the Russian gas giant Gazprom are in euros or dollars.
However, a European Commission spokesman said on Tuesday that opening a ruble-denominated account at Gazprombank would violate the EU’s sanctions regime.
“This goes beyond the guidance we are giving member states about what was allowed under the regime,” the spokesman said at a regular news conference.
Gazprom did not respond to a request for comment on Tuesday.
DIVISION
Adding to the confusion is that gas buyers in Europe, where Russian gas is used extensively to heat homes and generate electricity, are fumbling with the payment puzzle and appear to have differing viewpoints on the payment system.
Finland’s state-owned energy company Gasum said on Tuesday it would not make any payments under Gazprom’s proposed payment agreement and is taking its dispute over ruble payments to arbitration. Continue reading
“In this situation, Gasum had no choice but to submit the contract to arbitration. In this challenging situation, we will do our utmost to be able to provide our Finnish customers with the energy they need,” Gasum CEO Mika Wiljanen said in a statement.
In contrast, French energy company Engie (ENGIE.PA) said on Tuesday it would make the next payment to the Russian gas giant in euros before the end of the month, as both companies agreed on a solution in line with European sanctions. Continue reading
Uniper, Germany’s largest importer of Russian gas, announced on Tuesday that it would transfer euros to an account at Gazprombank (GZPRI.MM). Germany’s RWE (RWEG.DE) said on Monday it had opened an account in Russia to pay for gas in euros. Continue reading
Italy’s Eni (ENI.MI) said it would make a decision on paying for Russian gas in the coming hours or days. Continue reading
EU countries are responsible for enforcing the bloc’s sanctions, which were unanimously adopted by the 27 member states. Brussels could take legal action against a government that failed to enforce them.
Russian President Vladimir Putin’s decree said a transaction would not be complete until the foreign currency had been converted into rubles, and companies would need two bank accounts to do this – one for each currency.
Russia stopped gas supplies to Bulgaria and Poland last month after they refused to pay its ruble demand.
The Commission’s guidelines said companies should make a “clear statement” that if they pay in euros or dollars they will consider their obligations under existing contracts fulfilled.
By terminating its obligations after depositing euros or dollars, a company could avoid being involved in dealings with the sanctioned Central Bank of Russia, which may have been involved in the conversion of euros into rubles.
Reporting by Kate Abnett, additional reporting by Stine Jacobsen; Adaptation by Jan Strupczewski, Nick Macfie, Barbara Lewis and David Evans