Italy: Russia won’t seek payment in rubles for natural gas

Italian Premier Mario Draghi mentioned Thursday that he had acquired assurances from Russia‘s chief that Europe wouldn’t should pay for pure gasoline in rubles as demanded, much like pledges that Germany acquired, and subtle fears that Moscow would minimize off provides which might be used for heating and electrical energy.

Draghi mentioned Russian President Vladimir Putin assured him throughout a 40-minute cellphone name Wednesday night that “existing contracts remain in force. … European companies will continue to pay in dollars and euros.”

Putin introduced final week that Russia will demand “unfriendly” international locations pay for pure gasoline solely in Russian foreign money, instructing the central financial institution to work out a process for consumers to accumulate rubles in Russia. That despatched already excessive gasoline costs even increased amid fears it could possibly be a prelude to a pure gasoline shutoff, which might disrupt Europe’s financial system and damage Russia’s funds. The Group of Seven main economies, together with Italy and Germany, agreed to reject the demand.

The Italian chief indicated that Russia nonetheless had a want for funds in rubles however that it’d deal with the foreign money conversion. Draghi mentioned Putin gave a prolonged clarification of each preserve the funds in euros in {dollars} whereas satisfying Russia’s “indication of payments in rubles.’’

Draghi said he referred the discussion to experts and that analysis was underway “to understand what it means,” together with whether or not “European companies can continue to pay as foreseen, if this means something for the ongoing sanctions.”

“The feeling is one I have had since the beginning, that it is absolutely not simple to change the currency of payments without violating the contracts,” Draghi said.

German Chancellor Olaf Scholz received similar assurances from Putin on Wednesday evening. Scholz had asked for further details of the process, which involves payments to a Russian bank not subjected to sanctions, his office said.

Italy’s Draghi also told the foreign press corps that Europe is pushing for a cap on gas prices with Russia, saying its payments are funding the war in Ukraine and the prices being paid by Europe are out of line with the global market.

“We — Germany and Italy, along with other countries that are importers of gas, coal, grains, corn — are financing the war. There is no doubt,’’ Draghi said. “For this reason, Italy along with other countries, are pushing for a cap on the price of gas. There is no substantial reason that the price of gas is so high for Europeans.”

Draghi famous that Russia has no different marketplace for its gasoline, giving Europe room to maneuver. Asked concerning the danger that Russia would reply by turning off the faucets, Draghi mentioned, “no there is no danger.”

The prospect of continued gasoline deliveries in change for euros drew a cautious welcome from German business.

“It’s good news at least in the short term, because Russian gas deliveries can’t be replaced in the short term,” Achim Dercks, the deputy managing director of the Association of German Chambers of Commerce and Industry, advised RBB24 Inforadio on Thursday.

He famous that corporations are involved that any cutoff would have an effect on business particularly, “but ultimately that would have severe economic effects for us all.”

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