26 April, 04:39 PM

Azerbaijan refutes claims that it paid Gazprom in rubles

Azerbaijan's state-owned fossil fuel company SOCAR denied Russian media reports that Azerbaijan will allegedly settle accounts with Russia for imported gas in rubles, in a comment to the Interfax news agency on April 25.

"The media on Monday (April 25 - ed.) reported that the Republic of Azerbaijan will pay in rubles the cost of gas imported from Russia. This information is not true,” a company spokesperson said. 

The supply of Russian gas to Azerbaijan is currently carried out within the framework of an agreement on the seasonal exchange of natural gas, signed in July 2021 between the state company Azerkontrakt and the Russian state-owned gas enterprise Gazprom Group. 

The agreement is valid until 2023. The document provides for the supply of gas from Azerbaijan to Russia in the summer season, and similar volumes of gas from Russia to Azerbaijan in the winter season. The volume of supplies will depend on the level of gas production and consumption in Azerbaijan in the summer months. 

However, these contracts are traditionally settled in US dollars or euros - not Russian rubles, until Russian dictator Vladimir Putin signed a decree on March 31 obliging several gas purchasers to do so. This was done in order to both bolster the Russian economy, which is currently suffering under comprehensive sanctions packages imposed over its invasion of Ukraine, as well as to avoid having payments added to Russian-owned US dollar accounts currently frozen by various Western banking institutions. EU countries have largely rejected this decree.

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