Russia asks to use euro instead of dollar to oil clients

Russian energy companies are pushing Western oil buyers to use euros instead of dollars for payments and introduce penalty clauses in the contracts so that Russia can counteract possible future US sanctions, according to reports from Reuters.

Seven sources of the Russian energy industry consulted by the British media claim that Western oil companies have been forced in recent months to renegotiate the terms of oil sales contract of 2019 with the third and fourth largest producer in Russia, Gazprom Neft and Surgutneftegaz.

The report adds that in similar circumstances these and other Western clients are immersed with Russia’s leading state oil producer, Rosneft. Earlier this week, several sources told Reuters that Rosneft wants Western oil buyers to pay fines starting in 2019 if they do not pay for supplies in the event that new US sanctions interrupt sales.

Now, the same sources reported that Surgutneftegaz and Gazprom Neft follow the same steps as Rosneft and demand that their clients use the European currency or another currency to replace the dollar in the contracts.

“It’s part of the same trend: the Russian oil industry is working to mitigate new sanctions risks. The buyers in turn argue that they can not take those risks, so we are trying to solve it by acquiring some commitment in this regard,” stressed a Western source involved in negotiations with Russian oil companies to Reuters.

The relations between Moscow and the West, Washington in particular, worsened as a result of the situation in Ukraine and the reincorporation of Crimea to Russia after the referendum held in March 2014, in which more than 96 percent of voters endorsed this option.

Since then, the US, the European Union (EU) and other countries have approved several sanctions packages against the Eurasian country. Moscow, for its part, has repeatedly pointed out that it is not part of the conflict in Ukraine, and has reaffirmed that the reincorporation of Crimea was carried out in compliance with international law and the Charter of the United Nations (UN).

 

With info from HispanTV & Reuters


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