The EU refuses to pay in rubles for Russian gas and Germany prepares the population for rationing

The German government has declared the “early warning” level of its energy emergency plan in the face of the risk of a possible cut in Russian gas supply as a result of the refusal to comply with Moscow’s demand to pay in rubles for the fuel. This alert is the first of three and does not yet involve state intervention to ration supply, but, according to Financial Timesit is not ruled out if the crisis worsens.

The German Minister of Economy, Robert Habeckhas confirmed in a public statement the activation of the “early warning” level, the first of the three phases of the German Government’s emergency plan to guarantee the country’s energy supply.

In this way, a working group will be established within the Ministry of Economy that will be in charge of supervising the situation and the reserves on a daily basis, which are currently at 25% of their capacity.

“We must increase precautionary measures to be prepared for an escalation by Russia”

“We must increase precautionary measures to be prepared for an escalation by Russia. With the declaration of the early warning level, a crisis team has been created,” Habeck said.

In case the crisis worsens and the supply is considered insufficient and the market participants are able to handle the situation by themselves, the Government could even decide to disconnect parts of the industry from the network, since households would receive preferential treatment, says Financial Times.

The European Union yesterday rejected Moscow’s demand to pay in rubles for gas purchases from Russian suppliers, a decision agreed with the G7 leaders. According to a spokesman for the European Commission, the G7 energy ministers and Energy Commissioner Kadri Sismon unanimously agreed to reject Russia’s demands to pay for Russian gas supplies in rubles.

The energy ministers used as an argument that the gas supply contracts must be respected and that they specify that the payment will be made in euros or dollars, which is why the members of the G7 and the EU will ask the companies that operate in their territories that do not accede to such demands.

Last week, Russia announced its intention to require payment in rubles for Russian gas purchases from all states that have implemented sanctions against the country. The Russian president then indicated that the country will continue to supply gas in accordance with the volumes and prices established in the contracts, although he expressed the intention to change the currency of payment.

However, the Kremlin clarified on Wednesday that the payment system in rubles will not be launched as of tomorrow, Thursday, since it is an “extended process in time.” “No, not at all,” answered the spokesman for the Russian Presidency, Dmitri Peskov, when asked if the ruble payment system for Russian gas will be launched on March 31.

He explained that “payment and supplies are a process extended over time.” “It is not that what is going to be supplied tomorrow has to be paid for (in rubles). It is more extended in time, simply from a technical point of view,” she said.

Will it affect other raw materials?

The demand raised by the Kremlin for countries hostile to Russia to pay in rubles for purchases of Russian gas should be extended to trade in other raw materials such as oil, grain or metals, according to the president of the Duma, the lower house of the Parliament of the Russian Federation, Vyacheslav Volodin.

“If you want gas, look for rubles,” warned the Russian politician on his Telegram account, where he stated that “it would be correct, where it is beneficial for Russia, to expand the list of goods exported in exchange for rubles: fertilizers, cereals, oil , oil, coal, metals, wood, etc”.