European Commission will offer companies a way to pay for Russian gas that does not violate sanctions

The European Commission intends to offer companies a way to pay for Russian gas that will not violate sanctions and at the same time satisfy the Russian side. This was reported by Bloomberg after reviewing the draft document.

Traders are looking forward to new recommendations from the EC, as many are late for payment for Russian gas in late May. Russia requires companies to pay under a new mechanism under which companies open two new accounts (in foreign currency and in rubles) with Gazprombank.

Yes, in the new recommendations, the EC plans to specify that companies must clearly declare their obligations after payment in $ or €. Also, the EC leadership will not prevent companies from opening $ or € accounts with Gazprombank and will allow them to buy Russian gas after the invasion of Ukraine. However, it is unknown at this time whether opening a ruble account will violate the sanctions.

Another key point of the recommendations is that once European companies make a payment in euros or dollars and declare their obligations, there should be no further payment requirements from the Russian side.

Against the background of this news, natural gas prices in Europe are falling on Monday. Thus, futures for the June resource on the Dutch TTF fell by 4%, down to 93.00 €/MWh.