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Putin cancels alternative for roubles conversion at Gazprombank in Russian gas payments

Russian President Vladimir Putin cancelled the alternative for purchasers of Russian gas to convert currency into roubles at Gazprombank, a governmental decree showed on Thursday, requiring the clients to search for roubles elsewhere.

The U.S. sanctions on Gazprombank, enforced last month, avoid the lending institution from managing any brand-new energy-related deals, potentially obstructing how European clients can spend for Russian gas.

Putin released the preliminary decree in March 2022, requiring the buyers of Russian gas to pay for deliveries via Gazprombank through a plan including payments in roubles.

It was not completely clear how the payments would be made after the amendments to the decree were released on Thursday. Russian authorities have actually said they have actually been dealing with ways to deal with the issue.

The updated decree states payments for Russian gas through the K-type rouble and foreign currency accounts will not be performed until the sanctions versus Gazprombank are raised and might be resumed by a choice of the Russian president.

Russia shipped about 15 billion cubic metres (bcm) of gas by means of Ukraine in 2023 - only 8% of the peak Russian gas flows to Europe through different routes in 2018-2019.

Nevertheless, some nations such as Turkey and Hungary still purchase gas in large volumes from Russia.

Hungary has actually asked the United States to exempt Gazprombank from sanctions when it pertains to payments for gas, saying those sanctions might negatively impact some U.S. allies

According to the sanctions, the business should unwind their deals with the bank by Dec. 20.

(source: Reuters)