PARIS—Some of Europe’s biggest natural-gas utilities have agreed to new payment terms with Russia’s Gazprom, defusing the threat of a sharp cutoff of Russian gas to the region after President
demanded payment in rubles.
The demand roiled Europe’s energy industry and prompted warnings from the European Union that paying for gas in rubles would run afoul of sanctions the bloc imposed in response to February’s invasion of Ukraine. Gazprom last month cut off supply to Poland and Bulgaria after the countries refused to comply with a Kremlin decree.
The Kremlin decree requires European gas buyers from countries it deems hostile to open two accounts—one in euros or the currency stipulated in the contract, and the other in rubles—with Gazprombank, the finance arm of the Russian energy giant. The decree calls for buyers to deposit funds into the euro account that are then converted into rubles by Gazprombank and automatically withdrawn for payment.
SpA, one of Europe’s biggest buyers of Russian gas, this week agreed to open both accounts with Gazprombank. The company said it would make its first payment under the new terms in coming days. Utilities in Germany, the largest buyer of Russian gas, said they have opened euro accounts with Gazprombank, while France’s
said it is testing a new payment mechanism that would keep the gas flowing and won’t violate European sanctions.
“We think this is acceptable to Gazprom,” an Engie spokesman said.
Italian Energy giant Eni SpA has agreed to open both a euro and a ruble account with Gazprombank, the Russian energy giant’s payment arm, and to deposit payments in the euro account.
Around half of Gazprom’s 54 clients have opened ruble accounts at Gazprombank, Russian Deputy Prime Minister
said on Thursday, quoted by Russian state media.
Germany, Italy and other countries heavily exposed to Russian gas have been scrambling to find alternative suppliers. Until that happens, however, Europe is counting on Russia to continue delivering natural gas that powers factories and heats homes across the continent. In Germany, the region’s economic powerhouse, Russia accounted for around 55% of gas imports in 2021. Before the war, Russia supplied around 40% of the EU’s natural gas.
Not everyone acceded to Russia’s payment demands.
Finland’s state-owned Gasum Oy said that gas imports from Russia could end this week after the company refused to accept Moscow’s new payment mechanism. A Gasum spokeswoman said that it wouldn’t open the new accounts with Gazprombank after quarreling for months with Gazprom over other aspects of its supply contract.
“This is just something we cannot accept,” spokeswoman
Gasum, which supplies 60% of Finland’s gas, buys all of its supply from Gazprom. The Finnish company is scrambling to bring in new supplies from a pipeline that connects to Baltic countries. In coming months, the company is aiming to install a floating platform to import liquefied natural gas. But Ms. Vaisanen said it would be challenging this winter to meet Finland’s gas needs.
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Some EU officials had warned that a European company opening a ruble account would violate the sanctions, because any ruble account is linked to the sanctioned Russian central bank. But on Wednesday,
Europe’s economy commissioner, said EU-based companies won’t violate the sanctions with the new payment method.
“If somebody told me they are paying in rubles, I would say that is a violation,” Mr. Gentiloni said. “But that’s not what’s happening.”
The new payment system isn’t expected to have a significant impact on Russia’s economy or its ability to earn foreign currency from oil-and-gas exports to Europe, economists say. The change is mostly symbolic, said
deputy chief economist at the Institute of International Finance in Washington.
“How you choose to denominate the transaction of Russian energy exports and raw materials, whether in euros, rubles, etc., doesn’t really matter,” Ms. Ribakova said. “What matters is that energy exports give Russia purchasing power, which it can convert into goods from abroad.”
Russia’s current account balance—the difference between how much its economy earns from the rest of the world compared with what it buys from abroad—has registered a record surplus since the invasion of Ukraine. High oil-and-gas prices have fattened its state coffers, while Western sanctions have limited its ability to import goods.
The ruble, which plunged immediately after the February invasion, has rebounded against the euro and the dollar after the Kremlin ordered Russian exporters to convert much of their foreign exchange holdings into rubles.
The Gazprombank logo at an oil-and-gas expo in Moscow last month.
German gas company VNG AG will pay in euros, which are then later converted by Gazprombank, according to VNG’s parent company,
. A test of this procedure has shown that the mechanism works, the company said.
“We will take all necessary measures to continue to ensure the supply and thus the economic stability in Germany in compliance with the legal regulations, which of course includes the EU sanctions law,” the company said.
Germany’s largest power producer, RWE AG, said it has opened an account with Gazprombank to pay for gas in euros, adding, “We are therefore acting in accordance with European and German regulation.”
A RWE spokeswoman declined to say whether the company also opened a ruble account.
said it would receive the gas bill in euros and then pay in euros to a Gazprombank account in accordance with Russia’s new payment mechanism. The company said it was in close contact with the German government on this approach.
“We are paying in euros to a euro account in Russia and believe that this is in line with both current sanctions and the Russian decree,” a spokesman said.
Austria’s oil-and-gas company
said it was “working on a sanctions-compliant solution,” without providing more details.
—Laurence Norman contributed to this article.
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