Following Putin’s announcement about selling gas for Rubles only to hostile nations, I decided to reach out to Michael Hudson and ask him (my level, primitive) questions. Here is our full email exchange:
Andrei: Russia has declared that she will only sell gas to “hostile countries” for Rubles. Which means that to non-hostile countries she will continue to sell in Dollars/Euros. Can these hostile countries still purchase gas from Russia but via third countries?
Michael Hudson: There seem to be two ways for hostile countries to buy Russian gas. One seems to be to use Russian banks that are not banned from SWIFT. The other way would indeed seem to be to go through what looks to develop as a formal or informal third-country bank or exchange. India and China would seem to be the best positioned for this role. U.S. diplomats will be pressing India to impose its own sanctions on Russia, and there is a strong pro-U.S. constituency there. But even Modi sees the obvious superior benefits of benefiting from India’s geopolitical position with Russia and China’s Belt and Road Initiative relative to whatever the U.S. has to
Back in the 1960s the West dealt with the Soviet Union using barter deals. Arranging this barter became a big banking business. Barter is the typical “final stage” of
— source michael-hudson.com | Michael Hudson | Mar 27, 2022