Russian President Vladimir Putin said on Wednesday that Russian gas sales to "unfriendly countries" would have to be paid in rubles going forward, as he attempts to leverage his country's in-demand resources to counter a barrage of Western sanctions.
"I have decided to implement ... a series of measures to switch payments — we'll start with that — for our natural gas supplies to so-called unfriendly countries into Russian rubles," Putin said on Wednesday at a televised meeting with top government ministers. "Russia will continue, of course, to supply natural gas in accordance with volumes and prices ... fixed in previously concluded contracts,". Putin added.
Marcel Salikhov, president of the Institute for Energy and Finance in Moscow, said the decision amounted to a "symbolic counter-sanction" aimed at the West. He mentioned that the Kremlin had already ordered exporters to exchange 80% of their foreign-currency proceeds for rubles.
After the Putin's announcement, the ruble strengthened against the US dollar and the euro. And following the Russian president's announcement, Russian space agency Roscosmos announced it would conduct all future international contracts in rubles.
It's worth noting that Russia provides about 40% of Europe’s natural gas and has previously threatened to halt the supply of its natural gas to Europe in response to Western sanctions over Moscow's invasion of Ukraine.
