Hungary, Slovakia search to beat US sanctions affect on Russian fuel funds

BUDAPEST (Reuters) – Hungary and Slovakia are in search of methods to make funds for Russian fuel that have been thrown into uncertainty by new U.S. sanctions on Russia’s Gazprombank, officers mentioned on Wednesday.

Hungarian International Minister Peter Szijjarto mentioned he would maintain talks with Russian Deputy Prime Minister Alexander Novak afterward Wednesday to work out a authorized answer relating to future funds for shipments.

The U.S. imposed new sanctions on Russia’s Gazprombank on Nov. 21, creating an impediment for European patrons of Russian fuel. Consumers have been utilizing Gazprombank to make the funds, together with a scheme for foreign money conversion to roubles.

A supply near the Slovak state-owned fuel firm SPP, which has a long-term contract with the Russian provider Gazprom (MCX:GAZP) and provides a lot of the Slovak market, mentioned the issue was acute as a month-to-month fee was developing and there was at the moment no identified means easy methods to make it.

Failure to pay may immediate Gazprom to droop shipments, the supply mentioned.

Russian President Vladimir Putin issued a decree final week cancelling the choice for patrons of Russian fuel to transform foreign money into roubles at Gazprombank.The lender mentioned individually in a press release it remained the one financial institution authorised to course of funds for Russian fuel by international patrons, however it can obtain funds solely in roubles.

The supply near SPP mentioned the difficulty affected different patrons in Europe as effectively, together with international locations within the Balkans, as banks weren’t keen to ship funds to Gazprombank, and there was no grace interval for the U.S. sanctions.

A spokesman for SPP mentioned the corporate was nonetheless analysing the state of affairs.

Slovakia and Hungary have been eager to proceed shopping for Russian fuel, although shipments to Slovakia face suspension from January as Ukraine doesn’t plan to increase a transit settlement with Gazprom. Slovakia has been looking for a workaround to permit the shipments to proceed.