Lately Russian authorities have been talking about dedollarization a lot. The European Union’s desire of strengthening the role of the euro coincides with Russia’s intention to reduce dependence on the dollar. Russia and the EU have close economic ties and opportunity to increase trade in Euro. Unfortunately two main obstacles stand in the way of increasing the share of euro transactions between them.
The first difficulty is existing order to carry out most of oil trade in Dollars and there is no possibility to change it quickly. The second obstacle is the low liquidity of the euro/ruble pair, especially considering the ruble course drop after Western sanctions.
“Russia and the EU are on the same side in this issue [pricing and energy trading in the euro],” said Thierry Bro – RBC senior scientist at the Oxford Energy Research Institute. At the same time, he noted that the European Union will be able to promote commodity trading in Euro more effectively without the UK in its composition.