Fascist Russia demands rubble payments for its oil and gas

Western countries say Putin’s real aim was to swiftly topple Ukraine’s government, and that its failure is a strategic catastrophe, bringing economic ruin and diplomatic isolation. Britain piled on more sanctions, including on state media organisations behind the RT broadcaster and Sputnik news agency. “Putin’s war on Ukraine is based on a torrent of lies,” Foreign Secretary Liz Truss said.

The United States also imposed fresh sanctions, targeting Russia’s technology sector, a sanctions evasion network and what it called “malicious cyber actors.”

With the war exacerbating fuel prices around the world, U.S. President Joe Biden was to release 1 million barrels of oil a day for the next six months from the U.S. Strategic Petroleum Reserve, the largest release ever, to try to bring down gasoline costs.

Facing stiff resistance from Ukraine’s military and a militant Western stance, the war-crimes accused Putin has played one of his biggest cards in the demand on European energy buyers. “They must open rouble accounts in Russian banks. It is from these accounts that payments will be made for gas delivered starting from tomorrow,” he said on Thursday, adding that Europe had until now been getting some gas for free because it was paying in euros then freezing them.

“If such payments are not made (in roubles), we will consider this a default on the part of buyers, with all the ensuing consequences … existing contracts will be stopped.”

However, the order signed by Putin does allow them to send foreign currency to a so-called “K” account at Russia’s Gazprombank, which would then return roubles for the buyer to make payment for the gas.

“Russia would have to physically halt gas flows to EU 27 (European Union member states) to force the issue, marking a major escalation not even performed at the height of the Cold War. It would mark another major financial blow to Russia’s coffers,” said analysts at Fitch Solutions.

In Germany, Defense Minister Christine Lambrecht said Germany was “facing the consequences” of the new reality triggered by Russia’s invasion of Ukraine. She stressed Europe’s need to have the US as an ally and friend. Despite the major pivot to increase defense spending in line with NATO goals and strengthen its own military in the wake of the Russian invasion of Ukraine, she said Germany’s first choice would always be dialogue.

“We will never presume to go it alone. We will always remain closely integrated in the European Union, in NATO, in the United Nations,” Lambrecht added.

Lambrecht praised US President Joe Biden’s leadership in the global political crisis triggered by the Russian invasion of Ukraine, adding that Europe needs the US as a friend and ally. Germany’s Economy Minister Robert Habeck said on Friday that the country is planning to almost completely end Russian energy imports by the end of the year.

Habeck, a member of the Green Party, said the plan meant that a considerable amount of progress would be made in a short space of time, as the West is rushing to wean itself off Russian energy amidst the invasion of Ukraine. Before the war began and the subsequent heavy sanctions targeting Russia, Germany received 50% of its coal, 55% of its gas, and 35% of its oil from Moscow.