Russian President Vladimir Putin allowed the oil and gas company Rosneft to sell its products directly for foreign currency. This is stated in Putin’s order of August 16.
The document states that Rosneft carries out transactions in accordance with paragraph 12 of the presidential decree “On the special procedure for conducting settlements under foreign trade contracts for the supply of Russian agricultural products” No. 589. This decree says that Putin, by his “special decision”, can allow companies to directly trade their products in foreign currency.
The decision is explained by “ensuring effective state and corporate governance, financial sustainability of the activities of individual economic entities.”
The mechanism to ban direct trading in foreign currency was introduced in response to the sanctions imposed against Moscow. Russian companies were forbidden to trade directly in foreign currency, they had to open a special account with Gazprombank, which received payment in foreign currency, sold it and transferred funds in rubles. This scheme of power for propaganda purposes was called the transfer of payments for gas into rubles, notes the publication Sota, which drew attention to Putin’s order on Rosneft.
The publication links this decision with a sharp depreciation of the ruble. The day before, the Bank of Russia at an extraordinary meeting of the Board of Directors on August 15 raised the key rate from 8.5 to 12 percent per annum. The day before, the ruble exchange rate broke through a psychologically important mark: one dollar was worth 100 rubles.
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