Sanctions working great! Germany and Italy will pay for gas in Rubles

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Germany and Italy have allowed national companies to open ruble accounts in Russia’s Gazprombank to comply with the new natural gas payment scheme and avoid a supply cut-off, Reuters reported on Friday, citing sources.

The move comes after Poland, Bulgaria and most recently Finland refused to accept Russia’s new payment mechanism, resulting in gas flows from Russia being halted.

According to the outlet, the move was approved by Brussels after discussions with the European Commission and is not considered a breach of the sanctions that the EU placed on Moscow over the conflict in Ukraine.

Russia’s new payment scheme requires gas buyers from “unfriendly” countries that have placed sanctions on Russia to open accounts in Russia’s Gazprombank. They can then deposit funds in their currency of choice, which the bank converts to rubles and transfers to Gazprom.

German gas importers have reportedly been notified by Berlin that they can open ruble accounts to pay for Russian gas, as long as the payments they make to Gazprombank are not in the Russian currency.

The Italian government has also reportedly been in discussions with the European Commission, after which the Italian energy company Eni announced it had begun proceedings to open accounts at the Russian bank, one in euros and one in rubles.