Russian energy giants Gazprom and Rosneft are repaying bonds despite fears that Moscow may renege on its own debt. Investors who bet on a payout could double their money. But the trick may get harder to repeat, writes Unmack1
Russian gas giant Gazprom repaid a $1.3 billion bond as expected, Reuters reported on March 7, citing an investor holding the security. State-owned oil group Rosneft will on March 9 repay a $2 billion bond, IFR reported on March 8, citing a company presentation to investors and analysts.
Investors had been unsure if the companies would repay the bonds after Russia placed restrictions on payments to foreigners holding its securities in response to drastic sanctions imposed by Western allies following the invasion of Ukraine. The Gazprom bond had been quoted at below 50% of par value on March 3, according to Refinitiv data.
A decree by Russian president Vladimir Putin on March 5 allowed the Russian government, companies and citizens to temporarily pay foreign currency debts owed to overseas creditors from “unfriendly countries” in roubles. Those countries include the United States, European Union countries, Britain, Japan, Canada, Norway, Singapore, South Korea, Switzerland and Ukraine.A view shows a Russian one rouble coin in this picture illustration taken October 26, 2018.