FX.co ★ EU and Russia fail to challenge USD reign despite mutual interest

Russian diplomats astonish people with common sense by twists in rhetoric. Ambassadors and policymakers often confuse people with statements and decisions contrary to those which have been made previously. Perhaps, the art of diplomacy justifies acting as appropriate under certain circumstances, but common sense rejects such developments of diplomatic relations. Vladimir Chizhov, the Russian ambassador to the EU, puzzles the Russian nationals with his amnesia. Recently, the Russian diplomat threatened the EU authorities with retaliatory measures in response to their sanctions. He warned Brussels that Moscow is serious about giving up the euro in international settlements and even terminating relations with Europe until the sanctions are lifted in full. Interestingly, the leaders of the 28 euro bloc countries vote unanimously at regular assemblies to extend economic sanctions against Russia. Moreover, the EU authorities always find an excuse to add new restrictions to the ones in force. At the same time, Vladimir Chizhov has unveiled Moscow’s plans to scale up a trade volume with the EU using the single European currency in mutual payments despite earlier threats. The idea of increasing the euro’s share in payments for mutual imports is being forged ahead at the high level as both Russia and the EU advocate against the reign of the US dollar. Brussels is promoting the euro as an alternative to the US dollar. “This issue is on the table both at the Russian government and the European Commission. The talks are being underway. We have been making more and more deals invoiced in euros,” the Russian ambassador commented on the Kremlin’s policy. Nevertheless, even if all invoices for imported goods and services are issued in euros, this will hardly shake the dollar’s reign, bearing in mind modest volumes of such deals. Someone may doubt it as the EU is buying up the Russian oil and gas. Actually, invoices for oil and gas are settled in dollars as the international oil trade is pegged to the US currency. “Things are not so easy even in case of the mutual interest. Meanwhile, large European energy companies seem to be unwilling to make deals in euros,” Vladimir Chizhov summed up his dialog with the EU.