From April 1, buyers will transfer payments into Russia's Gazprombank account in foreign currency, which the bank will then convert into roubles and transfer into the buyer's rouble account.

Russian President Vladimir Putin has said that if payments are not made as required, it will be considered a breach of obligations with consequences.
Russian President Vladimir Putin has said that if payments are not made as required, it will be considered a breach of obligations with consequences. (AFP)

Russian President Vladimir Putin has said that "unfriendly" countries, including all EU members, will need to set up rouble accounts to pay for gas deliveries from April.

Putin announced on Thursday that he signed a decree that outlines the "clear and transparent" process.

"They must open rouble accounts in Russian banks. It is from these accounts that payments will be made for gas delivered starting tomorrow, April 1," Putin said during a televised government meeting.

"If such payments are not made, we will consider this a breach of obligations on the part of our buyers with all the ensuing consequences," he said.

"Nobody sells us anything for free and we are not going to do charity work. That means existing contracts being stopped" if payments are not made, he added.

According to the decree, all payments will be handled by Russia's Gazprombank, a subsidiary of state energy giant Gazprom.

Buyers will transfer payments into a Gazprombank account in foreign currency, which the bank will then convert into roubles and transfer into the buyer's rouble account.

READ MORE: UAE energy chief: Energy market needs Russian oil, no substitute exists

Crippling sanctions

Western countries have piled crippling sanctions on Moscow since it moved troops into Ukraine, including the freezing of its foreign currency reserves.

While the United States banned the import of Russian oil and gas, the European Union – which received around 40 percent of its gas supplies from Russia in 2021 – has retained deliveries from Moscow.

The United Arab Emirates has doubled down on an oil alliance with Russia that's helped buoy crude prices to their highest in years as Moscow's incursion into Ukraine continues to rattle markets and send energy and commodity prices soaring.

United Arab Emirates Energy Minister Suhail al Mazrouei said on Monday that Russia, with its 10 million barrels of oil a day, is an important member of the global OPEC+ energy alliance.

“And leaving the politics aside, that volume is needed today,” al Mazrouei said. 

“Unless someone is willing to come and bring 10 million barrels, we don’t see that someone can substitute Russia.”

Led by Saudi Arabia and Russia, the alliance has the capacity to increase oil output and bring down crude prices that have soared past $100 a barrel.

READ MORE: Western allies lack consensus on banning Russia's energy over Ukraine war

Source: AFP