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    Payment in roubles could put EU firms in a debt spiral

    EU companies that will agree to Vladimir Putin’s demand for payment for Russian gas in roubles are taking the risk of falling into a spiral of debt, the Polish climate minister has warned.

    Anna Moskwa made her cautionary comments after a meeting of EU energy ministers in Brussels on Monday.

     

    Moskwa said the contracts EU firms have with Russian gas monopolist Gazprom specify that payments be made in US dollars or the euro.

     

    “When Putin signs a decree, trying to undermine these contracts, it is already something that is unlawful,” the Polish minister said.

     

    She warned that agreeing to payments in roubles involved the risk of a currency exchange rate that would be set arbitrarily by Russia.

     

    “We can imagine a situation where countries are paying their funds to a new account, and from there it is unclear what the exchange rate into roubles will be,” Moskwa said. “We can fall into a cycle of perpetual debt owed to Gazprom and Russia.”

     

    In this context, Moskwa praised the position of the European Commission, which said payments for Russian gas in roubles were unacceptable.

     

    Gazprom has already stopped gas supplies to Poland and Bulgaria over the two countries’ refusal to comply with Putin’s decree.

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