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Win for Putin while Italy defies Europe and opens a ruble account to pay for gas

ROME – At the start of Vladimir Putin’s savage war in Ukraine, the European Union unified a front to boycott anything Russian. Despite the initial reluctance of Italy, Germany and Hungary, who “had disgrace” over their Kremlin ties, the pressure led even these holdouts to band together and confiscate oligarchic yachts and mansions and halt Gucci and Prada exports to wealthy Russian customers .

But as the war rages on – and energy prices soar – many of Europe’s energy giants are growing weary and finding ways to keep buying Russian gas without angering Putin, who on 31 Russian currency. A reverberation was felt across Europe last month when Russia abruptly halted supplies to Poland and Bulgaria after they refused to pay in rubles.

Italian company Eni confirmed late Tuesday that it would indeed open a ruble account with Russian energy company Gazprom’s Gazprombank (which somehow escaped sanctions) to meet Moscow’s demands for payments in Russian currency. To circumvent the sanctions, Eni – who previously paid directly to Russian energy company Gazprom by bank transfer in euros – will also open a euro account with the bank and let the bank make the transfer in rubles on her behalf.

Almost half of the 90 percent of all gas imports in Italy comes from Russia. The country does not yet have a viable backup plan in case the Kremlin turns off the faucet. “There is no official explanation of what it means to breach sanctions,” Italian Prime Minister Mario Draghi said Tuesday as he pressed for the payments. “Nobody has ever said anything about whether sanctions were imposed for ruble payment violations.”

With many countries, including Italy, counting down to next year’s elections, voters’ utility bills are a priority. Germany’s Uniper SE and Austria’s OMV AG are also reportedly expanding the same EU loophole, allowing Italy to pay in rubles without breaking sanctions. The EU Commission, which hardly has a reputation for being tough, is also to blame for never providing guidance on how countries can pay Gazprom for fuel.

Gas prices in Europe fell slightly on Monday after EU Commission spokesman Eric Mamer said opening ruble accounts was not technically against any rules. “Anything beyond opening an account in the contract currency with Gazprombank, making a payment to that account and then making a statement that you believe you have completed the payment is in violation of the sanctions,” he said he. leave the question to interpretation.

On Tuesday, he backtracked, actually saying that opening bank accounts in rubles “goes beyond recommendations and is a violation of sanctions.” But by that time, Italy’s Eni had already opened the account.

Some critics now say that European countries are turning a blind eye to the bodies of tortured Ukrainian citizens piling up in Mariupol and other areas besieged by Russian forces, while at the same time patting themselves on the back for pushing back refugees without the usual people Escape from war often confronted.

https://www.thedailybeast.com/win-for-putin-as-italy-defies-europe-and-opens-ruble-account-to-pay-for-gas?source=articles&via=rss Win for Putin while Italy defies Europe and opens a ruble account to pay for gas

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