Gas soars after Putin’s statement on ruble payments

Russian President Vladimir Putin says Russia will start selling gas in rubles to “unfriendly countries” as the European Union promotes legislation. minimum levels of stored gas reserves.

In particular, Vladimir Putin said that Russia intends to turn to the ruble in transactions for the sale of gas to “unfriendly”, adding that the government will instruct Gazprom to make corresponding changes in the contracts.

Putin called on the central bank and the government to set up a new system “within a week” that should be “clear, transparent” and regulate payments, including “the acquisition of rubles in the Russian foreign exchange market.”

The Russian president’s statement pushed the price of the British delivery council the next day to a jump of 18%, to 259.50 pence per million British thermal units, according to Reuters.

Respectively, in the Netherlands the gas contract for the next month jumped by 15% to 114 euros per megawatt hour, while the price for the second quarter recorded a “jump” by 16% to 113.65 euros per megawatt hour.

Putin added, of course, that “Russia will, of course, continue to supply gas according to the volumes and prices … set out in previous contracts,” explaining that “the changes will only affect the payment currency, which will change.” in Russian rubles ”.

According to Reuters, as of January 27, Gazprom’s gas sales in Europe and other countries are settled mainly in euros, at around 58%.

At the same time, the European Commission has proposed legislation requiring EU countries to maintain reserves of at least 80% of their capacity this year, and at least 90% by 1 November each year from 2023 onwards.

The legislation will need the approval of EU countries and the European Parliament, but traders stress that this goal is difficult to achieve even at times when demand is lower.