Turkey, Hungary receive US sanctions waiver to pay Russia's Gazprombank

Turkey and Hungary said Friday that they had received waivers on gas payments to Russia after the United States imposed sanctions on Gazprombank last month over Moscow's war with Ukraine. The exemptions remove a major obstacle to gas trade with Moscow.

Turkish Energy Minister Alparslan Bayraktar told Reuters in an article published Friday that the exemption had been granted. 

Despite its aspirations of becoming a gas hub, Turkey imports almost all of its gas. Russia is the top supplier, providing the country with more than 50% of its pipeline imports at around 21.1 billion cubic meters last year.

Hungarian Foreign Minister Peter Szijjarto said Thursday that the United States had also given his country, which also mainly relies on Russian oil and gas, an exemption on gas payments.

Slovakia has also been seeking clarification on alternative ways to pay for Russian gas since Washington sanctioned the state-owned Russian lender in November. Slovakia’s main gas, state-owned SPP, said it had not received notice about a sanctions waiver on payments to the Russian bank, Reuters reported.

Al-Monitor has contacted the US Treasury for comment on the exemptions.

On Thursday, Russian President Vladimir Putin published a decree easing restrictions on foreign buyers of Russian gas paying roubles at other banks until April 1. The move means that Gazprombank loses its monopoly as being the only bank foreign buyers must pay to buy Russian gas.

The United States first announced the sanctions on Gazprombank on Nov. 21, taking additional steps to curtail Russia’s use of the international financial system. It designated more than 50 internationally connected Russian banks, more than 40 Russian securities registrars and 15 Russian finance officials.

Barely a month later, Timothy Ash, senior emerging markets sovereign strategist at RBC BlueBay Asset Management, wrote on his blog Friday, “This had seemed like a major step up in the sanctions regime when it was announced a few weeks back — and the sharp move in the rouble to a weak [point] of 115 to the rouble some weeks back was driven by that specific sanction."

He went on, “But countries dependent still on Russian energy supplies — Turkey and Hungary, et al, asked for carveouts and it looks like the US has agreed. There were other options for those states including agreeing energy credits or barter deals with Russia, but the US blinked.”

He said that the Biden administration would argue that Russia “blinked first” by easing payment restrictions, but said Washington was “short changing Ukraine constantly.”