Years ago, Russia was desperate for its energy exports to be paid for in US dollars. Now, with the invasion of Ukraine, and sanctions being imposed by many western countries, Russia has demanded payments in Rubles-whose value has plummeted-from April 1:
However, this is not a flat ultimatum, as the gas link between Russia and the EU is both direct (pipeline) and not transferable.
It may also raise EU countries’ search for alternative supplies, so Russia could lose out; EU countries have a commitment to wean from Russian gas supplies by 2024:
So, much power sits on both sides on the gas trade, and the EU may have the upper hand:
Countries would need to open Ruble accounts, from April 1, and if no payments are made in Rubles, it will be deemed a breach of contract and default:
It’s a kind of brinkmanship, with the threat of default looming, perhaps:
But, the Ruble is being helped by Russia’s central bank:
A lot of dust has to settle, or maybe, we need to see the rubble subside, as the Ruble slide ends, at least, for the moment. 🙂
Jamaica: Political Economy 