Putin Orders Ruble Payments for Energy, Says West’s Freeze on Russian Reserves Undermined Currencies
from Sputnik News:
Last week, Russian finance minister Anton Siluanov confirmed that about $300 billion of Russia’s gold and foreign exchange reserve cushion had been frozen as a result of Western sanctions. On Wednesday, Foreign Minister Sergei Lavrov called the move “theft.”
The collective West’s decision to freeze Russian reserves abroad constitutes the bankruptcy of their obligations before Russia, and undermines faith in their currencies, President Vladimir Putin has said.
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“In the past weeks, a number of Western countries have taken illegitimate measures on the so-called ‘freezing’ of Russian assets. The collective West has factually drawn a line under the reliability of its currencies, crossed out confidence in these currencies. Both the United States and the European Union have essentially declared a default on their obligations to Russia,” Putin said, speaking at a government meeting on Wednesday.
“In this connection, it’s clear that supplying our goods to the European Union and the United States and receiving payment in dollars, euros and a number of other currencies does not make any sense to us,” Putin added.
“Today, everyone knows what they previously suspected – that obligations held in dollars and euros may not be fulfilled,” the Russian president said.
Putin ordered the Russian Central Bank and the government to work out the means for payments to be made in rubles for Russian natural gas exports by countries designated as ‘unfriendly’ by Moscow, and instructed Gazprom to amend existing contracts accordingly.
“Unlike some of our colleagues, we value our business reputation as a reliable partner and supplier. The changes will only affect the payment currency, which will be changed to Russian rubles,” Putin stressed. “Russia will unquestionably continue to export natural gas in accordance with volumes at prices fixed in contracts concluded earlier,” he added.
Frozen Reserves
About $300 billion out from the Central Bank’s $640 billion national reserve cushion, which was carefully amassed over the years for a rainy day, including by forgoing spending on various government and social programmes, were frozen in an instant after the US and its allies introduced sanctions on Russia over its military operation in Ukraine.
