Hungary found a way to pay Russia for gas in rubles without violating EU sanctions

Peter Szijjarto

Hungary has found an option to pay for Russian gas in rubles that would not violate EU sanctions imposed on Moscow , Hungarian Foreign Minister Peter Szijjártó said, REUTERS reports.

“As for payment in rubles, we have a solution that does not violate any sanctions, but at the same time ensures gas supplies to Hungary,” the diplomat said.

Szijjarto said that Budapest will use the following scheme: CEE Energy, a subsidiary of the Hungarian energy company MVM, will pay the gas bill in euros, which Gazprombank will convert into rubles and transfer to Russia's Gazprom EXPORT. He noted that the ability to pay bills not only in euros has already been included in the bilateral contract between CEE Energy and Gazprom Export, and new changes will also be made to it.

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On March 23, President Vladimir Putin announced that Moscow would change the currency of payments for gas with "unfriendly countries" to the Russian ruble. On March 31, the HEAD of state signed a corresponding decree, the new scheme began to operate from April 1. Presidential spokesman Dmitry Peskov noted that the transition to settlements in rubles would not be instantaneous, since "payment and deliveries are a process extended over time."

The European Union (all member countries of which are recognized as "unfriendly") reacted ambiguously to Moscow's decision. For example, French leader Emmanuel Macron pointed out that this requirement violates contracts and Paris will not pay for gas in rubles. The same was stated by German Chancellor Olaf Scholz.

Other countries admitted that they would buy Russian gas for rubles, including Hungary. At the same time, the EU authorities called such a step a violation of the sanctions imposed on Russia.

In response, the representative of the Hungarian Cabinet of Ministers, Zoltan Kovacs, said that Budapest would adhere to the oil and gas contracts concluded with Moscow. “According to them, it is a technical issue in which currency to pay. This does not mean circumvention of any sanctions policy. As we well know, the Hungarian economy and the Hungarian population depend on Russian gas by 85%,” he said.

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