Russia formally sent notice to the buyer!

2022-05-31 0 By

Beijing, April 2 (Xinhua) –Russian Gas company Gazprom said Monday that a ruble settlement decree signed by President Vladimir Putin has come into effect and the company has sent an official notice to buyers of the new rules.On March 31, Putin signed a presidential decree to settle gas trade with “unfriendly” countries and regions in rubles.Putin said “unfriendly” countries and regions would have to open ruble accounts in Russian banks to buy Russian gas, effective April 1.If you refuse to pay in this way, it will be regarded as a breach of contract by the Russian side and all consequences shall be borne by the buyer.Photo taken on March 24, 2019 shows ruble notes and coins in Moscow, Russia.The “unfriendly” countries and regions identified by Russia include the United States, members of the European Union, the United Kingdom, Ukraine, Japan and South Korea.’As a Russian company, Gazprom unconditionally and fully complies with the laws of the country,’ gazprom said in a statement.The company has issued a formal notice on the 1st, asking relevant buyers to settle in rubles.”Gazprom is a reliable and responsible partner and will continue to export gas to customers.”Russian gas supplies to Europe did not stop when the ruble settlement order came into force.Russian presidential press secretary Dmitry Peskov explained that Russia would not immediately “cut off” gas to Europe, as the cost of gas supplies starting on 1 Should be settled in the second half of April or May.Russia plays an important role in European countries’ energy supplies, importing about 40 percent of the EU’s gas needs in euros and dollars.Russia’s Sputnik news agency quoted Peskov as saying that the Russian side at the present stage to switch to rouble settlement of gas is the best option.Asked if Russia could reverse the decision, he replied: “If circumstances change, yes, because nothing stays the same.But for now we think the rouble is the best and most reliable option.”When asked by journalists whether Russia required the settlement of finished gas supplies in rubles, Peskov replied in the negative: “No, this rule is not retroactive.”While Russia continues to pump gas to Europe, Russian media have reported that gazprom is considering the possibility of a “gas cutoff” in Europe and assessing the impact of such a move.European leaders said they would not abide by Russia’s “ruble settlement order”, insisting that Russia’s move violated the terms of the relevant contracts.As the deadline approaches, the governments of these countries and energy companies are working together to come up with countermeasures.The exchange rate of the Russian ruble against the US dollar rose above 81 for the first time since February 23 on April 1, according to data from the Moscow Stock Exchange.It marked a strong return of the rouble to the level before sanctions were imposed after the outbreak of the conflict between Russia and Ukraine.Over the past month, the rouble exchange rate has experienced huge fluctuations.On February 24, the Russian side announced the launch of special military operations, the ruble began to show signs of rapid depreciation, the exchange rate of the DOLLAR fell below 80 to 1 on the same day, followed by a downward trend, on March 9, once fell below 120 to 1, a record low.But since late March, the ruble has rebounded markedly against the dollar.Analysts believe that in the complex geopolitical situation, the rouble market can achieve a reversal in a short time, there are three main factors.First, the Russian government has introduced a number of measures to stabilize the domestic financial market.In the face of the escalating financial sanctions imposed by the United States and other Western countries, the Russian Central Bank took a series of countermeasures.The measures include raising the benchmark interest rate to 20%, restricting individual foreign currency deposits and withdrawals from accounts, forcing enterprises to sell most of their foreign exchange earnings, temporarily banning non-resident legal entities from withdrawing cash in major foreign currencies such as U.S. dollars, and suspending securities dealers from accepting commissions from foreign investors to sell Russian securities.Russian financial analyst Oleg Serovatkin believes that the Central bank of Russia a series of measures to reduce the domestic market for foreign exchange demand, limit domestic capital outflow, which reduces the pressure on the devaluation of the ruble.Second, russia-Ukraine negotiations have made positive progress.On March 29, Russia and Ukraine held a new round of face-to-face talks in Istanbul, Turkey. Russia promised to significantly reduce its military operations in Kiev and Chernigov, and Ukraine proposed to establish a neutral status under international security guarantees.After the talks ended, the ruble strengthened further, dropping below 83 to the dollar for the first time since February 25.Georgi Ostapkovich, director of the Market Research Center of the Russian State Higher School of Economics, said that huge geopolitical uncertainties and western sanctions have put downward pressure on the ruble, and positive progress in russia-Ukraine negotiations is conducive to easing conflicts and stabilizing the situation, thus promoting the stabilization and strengthening of the ruble exchange rate.Third, Russia introduced a ruble settlement order for natural gas.Russian President Vladimir Putin announced on March 23 that Russia will switch to rubles for gas supplies to “unfriendly” countries and regions such as EU member states.The rouble jumped to a three-week high against the dollar on the day after the news.Putin signed a presidential decree on March 31, and the new regulations will take effect on April 1.Using the ruble would lower transaction costs for Russia and keep revenue in Russia, while reducing the willingness of international markets to short the ruble, said Alexei Salikhov, director of the Russian Institute of Energy and Finance.Igor Yushkov, chief analyst at the Russian National Energy Security Foundation and an expert at the University of Finance and Finance of the Russian Federal Government, said the move is an important step taken by Russia to stabilize the ruble exchange rate under the pressure of sanctions.Europe is highly dependent on Russian gas and using rubles to settle gas trade will boost international demand for the currency.In the future, Russia’s export of oil, metals and other bulk commodities may also be settled in ruble, when the value of the ruble, the international trade settlement system may face reconstruction.(Original title: “Ruble settlement order” effective Russian official notice to the buyer