Central Banks of Turkey, Russia to Start Working Out Ruble Gas Payments, Energy Minister Says

ANKARA (Sputnik) - The central banks of Turkey and Russia will start the works for arranging partial payments for Russian gas imports in rubles, as agreed by the presidents of the two countries, Turkish Energy Minister Fatih Donmez said.

Last Friday, Turkish President Recep Tayyip Erdogan and Russian President Vladimir Putin met on the sidelines of Shanghai Cooperation Organisation summit in Samarkand and agreed that Turkey will pay for 25% of gas it imports from Russia in the Russian national currency.

"There is an agreement to pay for Russian gas in rubles. If one of the parties, be it the buyer or the seller, has their money in a currency other than dollars or euros, it will inevitably incur costs associated with the exchange rate difference. We will get rid of this difference. In fact, this is not a new issue, it has been discussed many times. For the past three or four years our president had an idea and a strategy with many countries as to 'we should trade in local currencies, we will earn more," Donmez was quoted as saying by the Turkish newspaper Yeni Safak.

The Central banks of both countries "must be in a scheme" in order for Turkey to pay for Russian gas in rubles, according to the minister.

"Because the buyer or the seller of goods, of course, goes to the bank. The bank transfers money in accordance with the relevant agreements of central banks. Central banks determine which exchange rate will be used and how the money will be transferred," the minister explained.

Ankara is one of the biggest Russian gas importers: last year, it accounted for about 45 percent of Turkey's natural gas imports. Russia delivers its natural gas to the country via two major Black Sea pipelines - Blue Stream and TurkStream that have a total capacity of over 46 billion cubic meters per year.