INTERNATIONAL: Russian President Vladimir Putin has announced on Wednesday,March 23, that Russia would start selling gas to "unfriendly countries" in roubles, after a freeze on Russia's assets by foreign nations had destroyed Moscow's trust.
Putin has said the changes would only affect the currency of payment and that the government and central bank had one week to come up with a solution on how to move these operations to the Russian currency.
The Russian rouble has closed on Wednesday at its strongest this month against the dollar both in Moscow and offshore exchanges after President Vladimir Putin said Russia would start selling its gas to "unfriendly" countries in roubles.
The rouble ended below 100 per dollar, still down over 22% this year as Russia faces strict sanctions globally, triggered by its invasion of Ukraine late last month.
European gas prices have soared after Putin's shock announcement, on concerns the move would exacerbate the region's energy crunch.
It seems to be an effort by the Russian authorities to apply pressure on Western countries by forcing foreign buyers of Russian gas to use roubles, with the added benefit of supporting the value of the currency," said Liam Peach, Emerging Europe economist at Capital Economics in a client note.
The rouble has gained 6 percent to close at 97.7375 per dollar in Moscow after touching 94.9875, its strongest since March 2. It closed up 8.8 percent at 96.5 on the EBS platform. Both closing prices were the strongest since February.
