Hungary States EU Countries Covertly Buying Russian Gas In Rubles

Hungary Throws EU Neighbors Under The Bus, Says 10 Nations Technically Buying Gas-For-Rubles From Putin

TYLER DURDEN

The Ruble has 'mysteriously' surged to six-month highs against the dollar (and even stronger relative to the Euro) over the last few weeks since Russian President Putin demanded Rubles-for-Gas...

But now, Hungarian Prime Minister Viktor Orban's chief of staff, Gergely Gulyas, appears to have spilled the beans on what is really going on among the Russia-dependent European nations.

Gulyas told public radio on Sunday that while multiple European leaders have publicly proclaimed they won’t comply with Putin's demand that they buy Russian gas in rubles, 10 EU countries are technically going along with Putin’s plan.

It is unclear which EU countries Guylas was referring to. Russian energy giant Gazprom has already shut off supplies to Poland and Bulgaria after both refused to pay in rubles, but a Bloomberg report last week stated, as Gulyas did, that 10 of the bloc’s member states have already set up accounts with Gazprombank, and four have actually paid for Russian gas using this mechanism.

On Thursday, EU officials confirmed that any company agreeing to open a rouble account in Russia and pay for gas that way would be in breach of sanctions, but as The Guardian detailed last week, there could be a loophole.

According to further guidance issued by the EU last week, the Kremlin’s decree does not stop gas importers asking Gazprom to agree the purchase is legally complete once the first payment, in euros or dollars, has been deposited at Gazprombank.

Any conversion into roubles would take place thereafter, meaning the buyer would not technically have breached sanctions. Another option, the guidance says, is for buyers to make a public declaration that they consider the purchase complete once their dollar or euro payment is made. The only obstacle to this, according to the guidance, is the need for “confirmation from the Russian side” that all of this complies with decree 172.

In other words, Gazprom – or effectively the Kremlin – has to be onboard. Gazprom and Gazprombank are not subject to EU sanctions, so buyers are permitted to negotiate such labyrinthine proposals without breaching sanctions.