Russian President Vladimir Putin signed the decree on Thursday, stipulating that all contracts for pipeline gas deliveries with companies registered in countries that have sanctioned Russia be settled in rubles. This only concerns Gazprom's pipeline exports and does not mean that some of the clients may end up without gas tomorrow. A source has told Sputnik, that the company has to receive first payments for some contracts in rubles in the second half of April and in May.
Last week, the president tasked the government and the national energy giant Gazprom with arranging a switch of gas payments to rubles with countries that have imposed sanctions on Russia over the special military operation in Ukraine by the end of March.
The move has already provoked criticism and confusion in the West, with various countries objecting and claiming it would be a breach of existing contracts. The G7 countries have already refused Russia's demand, as the German economy minister said earlier in the week.
Experts from the Moscow-based think tank Institute for Energy and Finance (FIEF) have explained, however, that the decree would allow for uninterrupted transit without breach of sanctions or existing contracts, as it requires Gazprom's clients to switch to making payments through Gazprombank, which would take their euros, exchange them to rubles at the Moscow Exchange and deposit money at rubles accounts.
Gas prices in Europe have grown in the last days of March, following the increasing geopolitical risks.
After having rebuffed Moscow's initiative, Europe, which receives roughly 40% of its gas from Russia, is currently discussing ways to diversify gas supplies and move away from Russian gas through other suppliers.
Brussels is also currently working with Washington to ensure that US liquefied natural gas exported to Europe is the least carbon-intensive possible, as the issue becomes even more important than before.
Meanwhile, Spain and Portugal have already urged the European Commission to put a cap on gas prices in the two countries at 30 euros ($33) per megawatt-hour (MWh), which they expect to significantly reduce electricity bills.