Final Word from Thursday, May 19, 2022

Payments for Russian natural gas are coming due, and it's not clear what's going to happen. The EU Commission looked past the issue yesterday in announcing its new REPowerEU strategy, as did Petr Fiala and Karl Nehammer in their press conference on Tues. Yet the Commission has new guidelines that, according to Reuters, call for companies to state that when they pay for gas in euros or dollars, they consider their obligations under existing contracts to be fulfilled. When asked whether companies that follow the EU's sanctions rules risk being cut off the way Poland and Bulgaria were, Pres. Klaus Müller of Germany's Federal Network Agency (BNetzA) said that "we will see whether the payments work." He was rather hopeful that they would. By coincidence, or perhaps by design, Vladimir Putin spoke for 10 minutes on Tues. about his plans for the Russian oil & gas industry. Our impression was that he might accept non-ruble payments this time, but not much longer. [ Czech Republic K-account Gazprombank Gazprom Bundesnetzagentur European Commission Austria Chancellor counter-sanctions countersanctions ]