Türkiye on Friday repeated its call for it to be exempted from the sanctions the United States imposed on Russia's Gazprombank, a day after a decree signed by Russian President Vladimir Putin complicated the payment process for buyers of its gas.
Putin scrapped the option for foreign buyers of Russian natural gas to convert currency into rubles at Gazprombank, which was slapped with U.S. sanctions last month, meaning that countries, including Türkiye, must now convert their currency elsewhere.
Under the sanctions, Gazprombank cannot handle any new energy-related transactions that touch the U.S. financial system. The sanctions ban Americans from doing business with the bank and freeze its U.S. assets.
Gazprombank, which was the largest remaining Russian bank not previously blocked by the United States Treasury, is partially owned by Kremlin-owned gas company Gazprom.
The lender said separately in a statement it remained the only bank authorized to process payments for Russian gas by foreign buyers, but it would receive payments only in rubles.
"Gazprombank no longer assists foreign buyers in converting foreign currency into rubles for the purpose of payments for natural gas," it said.
The amendment added to concerns among countries still buying gas through the lender, including Türkiye and Hungary.
It remains unclear how gas buyers will manage their payments and convert their currencies to rubles. Russian officials have said they are working to address the issues arising from the U.S. sanctions.
Last month, authorities said Türkiye is in talks with the U.S. and Russia in an attempt to secure a U.S. sanctions waiver so it can continue paying Gazprombank for gas imports.
Türkiye imports almost all its gas needs and Russia is the top supplier, providing more than 50% of its pipeline imports.
"As I have said before, our country needs to be exempt from these sanctions," Energy Minister Alparslan Bayraktar told reporters on Friday when asked how Türkiye would be affected following Thursday's decree.
Last month, Bayraktar referred to a previous waiver granted to Ankara when Washington earlier sanctioned Iran, saying Türkiye needs something similar when it comes to Gazprombank for it to secure supply.
"These sanctions will affect Türkiye. We cannot pay, if we cannot pay we cannot buy the goods. The Foreign Ministry is in talks," he said.
"If such an exemption is not granted to Türkiye, it will directly impact us. At this point Russia is not the target, Türkiye is the direct target (of these sanctions)."
Last month, a Turkish official said Türkiye began talks with U.S. counterparts before the Gazprombank sanctions were announced, since Washington usually first announces the move, then grants exemptions.
"They are working on this issue," the official told Reuters.
Hungary has also asked the U.S. to exempt Gazprombank from sanctions when it comes to payments for gas, saying those sanctions could negatively affect some U.S. allies.
According to the sanctions, the companies should unwind their transactions with the bank by Dec. 20.
Putin issued an initial decree in March 2022 forcing buyers of Russian gas to pay for deliveries via Gazprombank through a scheme involving payments in rubles.
The mechanics of payments and currency conversion after the amendments to the decree were published on Thursday were not fully clear. Russian authorities have said they have been working on ways to resolve the issue.
The updated decree says payments for Russian gas via the K-type ruble and foreign currency accounts will not be conducted until the sanctions against Gazprombank are lifted and could be resumed by a decision of the Russian president.
Russia shipped about 15 billion cubic meters (bcm) of gas via Ukraine in 2023 – only 8% of the peak Russian gas flows to Europe through various routes in 2018-2019.
However, some countries, such as Türkiye and Hungary, still buy gas in large volumes from Russia.
Russia has faced a barrage of sanctions from Western countries in response to its military offensive on Ukraine in February 2022, including an oil price cap designed to curb the Kremlin's revenues.
Gazprombank had already been punished with sanctions by other countries including Australia, Canada, New Zealand and the United Kingdom.
