In an interview with the Financial Times, Derek Chollet, an adviser to the US State Department, said: “It will not be easy for Russia to find alternative buyers of its energy. “China is not going to be an excellent choice any time soon, as the infrastructure does not exist for Russia to transport its gas to China.” “If one of the biggest advantages Russia has had in the last decade or many decades has been as an energy supplier, it is isolated from this market,” he added. The comments came as tensions between Russia and the West over energy have escalated in recent days. Moscow cut off gas supplies to Poland and Bulgaria on Wednesday in a move described by European Commission President Ursula von der Leyen as “blackmail”. Prior to the Russian invasion of Ukraine, 97 percent of Russian gas purchases from Europe were made in euros or dollars. However, according to a rule introduced by Russian leader Vladimir Putin on March 31, gas buyers must now complete their purchases in rubles. To do this without paying Russia directly in rubles – something that would violate European sanctions – Moscow has proposed a two-tier system that includes opening accounts in rubles and euros at Gazprombank in Russia. Several European countries planned to comply with the regulation. However, on Thursday, the EU warned European buyers that even with the new mechanism, they would continue to violate sanctions because converting the euro into rubles would mean the involvement of Russia’s central bank. “We are very concerned about how strong the Europeans have been. “The EU was very clear that they were trying to wean themselves off of Russian energy,” Chollet said. “Many people were surprised by their willingness to start the process of weaning from Russian energy and I think they are going to do it over time.” He added that Russia’s strategy to demand payment in rubles is unlikely to be sustainable because it hinders its ability to earn significant revenues from foreign energy sales. “Russia relies on the sale of its energy for revenue, so there are limits to how far Russia can go without it hurting it more than it hurts Europeans,” Sole said. Washington is working with the European Union to close any sanctions windows related to the Russian gas market. “We are looking at all the options we can, whether all the options include new sanctions and new designations, as well as tougher sanctions that already exist,” Chollet said. Asked if this would include secondary sanctions, he said the United States “has not taken this step”, but will look into it as part of its efforts to ensure that sanctions are maintained over time. EU officials are consulting with the United States on the possibility of using the threat of US secondary sanctions on countries that may be tempted to buy Russian oil – the next EU sanctions target being prepared and likely to be approved next week. These discussions are continuing to better plan the restrictions so as not to cause the world oil price to rise and help, instead of hurting, the financing of Putin’s war, EU diplomats said. Additional Valentina Pop reportage in Brussels
