UK allows Russian banks to continue accepting gas payments

On April 22, the British Ministry of Finance said that EU countries can still pay for Russian gas purchase contracts signed before April 21 through Gazprombank and its subsidiary. The license will be valid until the end of May.

The license also allows customers to open and close an account with Gazprombank – one of the necessary conditions for gas payments under the ruble payment regulation proposed by Moscow.

Last month, the Kremlin passed a decree requiring “unfriendly countries” to open an account in foreign currency and a ruble account at Gazprombank to pay for energy contracts.

Russian President Vladimir Putin has warned that the country will cut off gas supplies to those who do not comply with the ruble payment method.

From the very beginning of the Russian-Ukrainian conflict, Britain imposed sanctions on Gazprombank. However, the EU opposes adding Gazprombank to the list of sanctions because this action is intended to threaten energy security in the context that the region imports up to 40% of its gas needs from Russia.

Gazprombank is one of the largest banks in Russia. This bank operates mainly in the corporate and investment sectors. In addition to the UK, the US and its allies also imposed sanctions on Gazprombank in February. Accordingly, the bank was imposed with debt and equity restrictions.

Earlier, on March 31, Russia announced that it would temporarily suspend gas delivery contracts to EU member states if these countries did not pay in rubles. Moscow also requires oil and gas buyers to open accounts at Gazprombank so that payments in euros or dollars will be converted to rubles.

On the same day, April 22, British Prime Minister Boris Johnson said that the British Embassy in Kiev will reopen next week.

“This decision reflects the extraordinary courage and success of President Volodymyr Zelensky and the Ukrainian people in fighting Russian forces in Kiev.” said Mr. Boris Johnson.

The British government began to move staff from the embassy in Kiev as early as January, when news about the risk of an all-out conflict between Russia and Ukraine emerged.

On February 18, British diplomats moved from Kiev to offices in Lviv, western Ukraine. This is a measure for them to “temporarily” avoid conflicts.