Russia will seek payment in roubles for gas sold to “unfriendly” countries, President Vladimir Putin said on Wednesday, and European gas prices soared on concerns the move would exacerbate the region’s energy crunch.
European nations and the United States have imposed heavy sanctions on Russia since Moscow sent troops into Ukraine on Feb. 24. But Europe depends heavily on Russian gas for heating and power generation, and the European Union is split on whether to sanction Russia’s energy sector.
Putin’s message was clear: If you want our gas, buy our currency. It remained unclear whether Russia has the power to unilaterally change existing contracts agreed upon in euros.
The rouble briefly leapt after the shock announcement to a three-week high past 95 against the dollar. It pared gains but stayed well below 100, closing at 97.7 against the dollar, down more than 22% since Feb. 24.
Some European wholesale gas prices up to 30% higher on Wednesday. British and Dutch wholesale gas prices jumped. [NG/EU]
Russian gas accounts for some 40% of Europe’s total consumption. EU gas imports from Russia this year have fluctuated between 200 million to 800 million euros ($880 million) a day.
“Russia will continue, of course, to supply natural gas in accordance with volumes and prices … fixed in previously concluded contracts,” Putin said at a televised meeting with government ministers.
“The changes will only affect the currency of payment, which will be changed to Russian roubles,” he said.
German Economy Minister Robert Habeck called Putin’s demand a breach of contract and other buyers of Russian gas echoed the point.
“This would constitute a breach to payment rules included in the current contracts,” said a senior Polish government source, adding Poland has no intention of signing new contracts with Gazprom after their existing deal expires at the end of this year.
Major banks are reluctant to trade in Russian assets, further complicating Putin’s demand.
A spokesperson for Dutch gas supplier Eneco, which buys 15% of its gas from Russian gas giant Gazprom’s German subsidiary Wingas GmbH, said it had a long-term contract denominated in euros.
“I can’t imagine we will agree to change the terms of that.”
According to Gazprom, 58% of its sales of natural gas to Europe and other countries as of Jan. 27 were settled in euros. U.S. dollars accounted for about 39% of gross sales and sterling around 3%. Commodities traded worldwide are largely transacted in the U.S. dollar or the euro, which make up roughly 80% of worldwide currency reserves.
“There is no danger for the (gas) supply, we have checked, there is a financial counterparty in Bulgaria that can realize the transaction also in roubles,” Energy Minister Alexander Nikolov told reporters in Sofia. “We expect all kinds of actions on the verge of the unusual but this scenario has been discussed, so there is no risk for the payments under the existing contract.”
Several firms, including oil and gas majors Eni, Shell and BP, RWE and Uniper – Germany’s biggest importer of Russian gas – declined to comment.
“It is unclear how easy it would be for European clients to switch their payments to roubles given the scale of these purchases,” said Leon Izbicki, associate at consultancy Energy Aspects. He said, however, that Russia’s central bank could provide additional liquidity to foreign exchange markets that would enable European clients and banks to source needed roubles.
Moscow calls its actions in Ukraine a “special military operation.” Ukraine and Western allies call this a baseless pretext.
ONE WEEK DEADLINE
Putin said the government and central bank had one week to come up with a solution on moving operations into the Russian currency and that Gazprom would be ordered to make the corresponding changes to contracts.
In gas markets on Wednesday, eastbound gas flows via the Yamal-Europe pipeline from Germany to Poland declined sharply, data from the Gascade pipeline operator showed.
“The measures taken by Russia may also be interpreted as provocative and may increase the possibility that Western nations tighten sanctions on Russian energy,” said Liam Peach, emerging Europe economist at Capital Economics.
The European Commission has said it plans to cut EU dependency on Russian gas by two-thirds this year and end its reliance on Russian supplies “well before 2030.”
But unlike the United States and Britain, EU states have not sanctioned Russia’s energy sector. The Commission, the 27-country EU’s executive, did not respond to a request for comment.
Habeck said he would discuss with European partners a possible answer to Moscow’s announcement. Dutch Prime Minister Mark Rutte said more time was needed to clarify Russia’s demand.
“In their contracts it’s usually specified in what currency it has to be paid, so it’s not something you can change just like that,” Rutte said during a debate with parliament.
Russia has drawn up a list of “unfriendly” countries corresponding to those that have imposed sanctions. Deals with companies and individuals from those countries must be approved by a government commission.
The countries include the United States, European Union member states, Britain, Japan, Canada, Norway, Singapore, South Korea, Switzerland and Ukraine. Some, including the United States and Norway, do not purchase Russian gas.
The United States is consulting with allies on the issue and each country will make its own decision, a White House official told Reuters. The United States has already banned imports of Russian energy.
($1 = 0.9097 euro)
(Reporting by Reuters reporters; writing by Nina Chestney; editing by Catherine Evans, Carmel Crimmins, Jonathan Oatis and David Gregorio)
UPEI students offered $1,500 to leave residence during Canada Games – CBC.ca
Some UPEI students are earning extra money during the mid-semester break this year, simply by packing up and leaving campus.
The 2023 Canada Winter Games Host Society offered $1,500 each to students living in Andrew Hall if they give up their residence rooms to make space for arriving athletes.
The students have to leave a few days before the break starts, on Feb. 17, and can return March 7. They also had to give up their meal plan for the duration.
Many athletes are staying at UPEI’s new 260-bed residence, built to meet accommodation requirements for the Games’ temporary athlete village.
But Wayne Carew, chair of the Games, said there are 120 more athletes coming than originally planned.
“We ended up getting 44 rooms [in Andrew Hall] and that’s great,” said Carew.
He said the athletes staying at UPEI “are going to have a wild experience on the campus of the beautiful University of Prince Edward Island.”
Carew said the costs of doing this are a “lot cheaper” than arranging accommodations elsewhere. But he said the main reason is to provide all athletes the same, “once-in-a-lifetime” experience.
“Where they live, the food and the camaraderie and the experience of a lifetime: that’s what they’ll remember in 20 years’ time about P.E.I.,” he said.
‘Pretty good deal’
Some students were eager to take the organizers up on their offer.
“I’m going away to Florida during the two-week break anyways. So I was like, ‘May as well let them use my room then,'” said Hannah Somers.
“It’s $1,500. Pretty nice,” said Benji Dueck, who agreed to vacate the room with his roommate. “We’re moving out, living with a friend in the city. So, sounds like a pretty good deal to me.”
As part of the agreement, the students had to clear out their rooms. Canada Games organizers made arrangements so students could store their belongings.
But not all students thought it was a good deal.
“I’m not giving up my spot in Andrew Hall for $1,500,” said Maria de Torres. “It’s just too hard to pack up. It’s just too hectic. And since I’m an international student, I got a lot [of things] right now.”
Shelby Dyment is also staying in Andrew Hall. Dyment said she and her roommate are working as residence life assistants during the mid-semester break and she’s also doing directed study, so she has to stay on campus.
“There’s a lot of people doing it. It’s just for our situation it just wasn’t working for what we were doing,” she said.
In a statement, UPEI said that enough students had accepted the offer to host all the athletes.
It said the host society made all the arrangements with the students, including paying for their incentives and arranging for storage.
Organizers expect about 3,600 athletes, coaches and officials to participate in the Games. The event will run from Feb. 18 to March 5.
Germany won't be a 'party to the war' amid tanks exports to Ukraine: Ambassador – CTV News
The German ambassador to Canada says Germany will not become “a party to the conflict” in Ukraine, despite it and several other countries announcing they’ll answer President Volodymyr Zelenskyy’s pleas for tanks, possibly increasing the risk of Russian escalation.
Sabine Sparwasser said it’s a “real priority” for Germany to support Ukraine, but that it’s important to be in “lockstep” coordination with other allied countries.
“There is a clear line for Germany,” she told CTV’s Question Period host Vassy Kapelos, in an interview airing Sunday. “We do want not want to be a party to the conflict.”
“We want to support, we want to do everything we can, but we, and NATO, do not want to be a party to the war,” she also said. “That’s I think, the line we’re trying to follow.”
Defence Minister Anita Anand announced this week Canada will send four Leopard 2 battle tanks — with the possibility of more in the future — to Ukraine, along with Canadian Armed Forces members to train Ukrainian soldiers on how to use them.
Canada first needed permission from Berlin to re-export any of its 82 German-made Leopard 2 tanks to Ukraine. After a meeting of 50 defence leaders in Germany earlier this month, it was unclear whether Germany would give the green light.
But following what German Chancellor Olaf Scholz called “intensive consultations,” Germany announced on Jan. 25 it would send tanks to Ukraine, and the following day, Canada followed suit. It is now joining several other countries, including the United States, the United Kingdom, and Poland, which are sending several dozen tanks to Ukraine.
NATO Secretary General Jens Stoltenberg said this week the tanks would allow Ukraine to “significantly strengthen their combat capabilities.”
“It demonstrates also the unit and the resolve of NATO allies in partners in providing support to Ukraine,” he said.
Meanwhile Sparwasser said Germany is “walking that fine line” of avoiding steps that could prompt escalation from Russia, while supporting Ukraine, and staying out of the war themselves.
“I think it’s very important to see that Germany is very determined and has a real priority in supporting Ukraine in its struggle for freedom and sovereignty,” Sparwasser said. “But we also put a high priority on going it together with our friends and allies.”
Sparwasser said despite warnings from Russia that sending tanks to Ukraine will cause an escalation, Germany is within international law — specifically Article 51 of the United Nations Charter — to provide support to Ukraine.
“Ukraine is under attack has the right to self defence, and other nations can come in and provide Ukraine with the means to defend itself,” Sparwasser said. “So in international law terms, this is a very clear cut case.”
She added that considering “Russia doesn’t respect international law,” it’s a more impactful deterrent to Russia, ahead of an expected spring offensive, to see several countries come together in support of Ukraine.
With files from the Associated Press
COVID: Canada retaining Evusheld – CTV News
While Health Canada says it is “aware” of the U.S. decision to withdraw the emergency use of Evusheld, a drug by AstraZeneca used to help prevent COVID-19 infection— the agency is maintaining its approval, citing the differences in variant circulation between Canada and the U.S.
The U.S. Food and Drug Administration (FDA) announced on Jan. 26 that its emergency use authorization of the drug was pulled due to its inefficacy in treating “certain” COVID-19 variants.
The FDA stated in a release on its website that as the XBB.1.5. variant, nicknamed “Kraken”, is making up the majority of cases in the country, the use of Evusheld is “not expected to provide protection” and therefore not worth exposing the public to possible side effects of the drug, like allergic reactions.
In an email to CTVNews.ca, Health Canada said the U.S. Food and Drug Administration pulled the drug as the main variant of concern in the U.S. is XBB.1.5.
“Dominant variants in the [U.S.] may be different from those circulating in Canada,” the federal agency said in an email. “The most recent epidemiological data in Canada (as of January 1, 2023) indicate that BA.5 (Omicron) subvariants continue to account for more than 89 per cent of reported cases.”
On Jan. 6 the FDA said in press release that certain variants are not neutralized by Evusheld and cautioned people who are exposed to XBB.1.5. On Jan. 26, the FDA then updated its website by saying it would be limiting the use of Evusheld.
“Evusheld is not currently authorized for use in the U.S. until further notice by the Agency,” the FDA website states.
On Jan. 17, Health Canada issued a “risk communication” on Evusheld, explaining how it may not be effective against certain Omicron subvariants when used as a preventative measure or treatment for COVID-19.
“Decisions regarding the use of EVUSHELD should take into consideration what is known about the characteristics of the circulating COVID-19 variants, including geographical prevalence and individual exposure,” Health Canada said in an email.
Health Canada says Evusheld does neutralize against Omicron subvariant BA.2, which according to the agency, is the dominant variant in many communities in Canada.
The drug was introduced for prevention measures specifically for people who have weaker immune systems and are unlikely to be protected by a COVID-19 vaccine. It can only be given to people 12 years and older.
“EVUSHELD is not a substitute for vaccination in individuals for whom COVID-19 vaccination is recommended,” the agency’s website reads.
Health Canada says no drug, including Evusheld, is a substitute for vaccination.
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