[International Situation]：Russia requires rubles to buy natural gas, otherwise the supply will be forcibly cut off. BASF will stop production and warn that the German chemical industry may encounter a cold winter.

on March 31, local time, Russian President Putin announced that he signed a decree on the rules of natural gas trading, that is, requiring "unfriendly countries" to buy Russian natural gas in rubles from April 1, otherwise, the supply will be forcibly interrupted.

Putin said that he had signed a decree on April 1, that is, today, which stipulated the rules for conducting Russian natural gas transactions with so-called "unfriendly countries. Putin said that Russia is providing a clear and transparent plan to the counterparties of these countries: to buy Russian natural gas, they should open a rouble account in Russian banks.

Putin stressed that, if the purchase of natural gas is refused to be settled in rubles from April 1, the companies of these "unfriendly countries" will be deemed as not complying with the imposing obligations of the natural gas contract, and the validity of the contract will be suspended. Putin said: "If the payment is not made, we will consider it as a breach of contract by the buyer and the buyer will be responsible for all the consequences. No one sells anything to us for free, and we don't intend to do charity."

putin finally said that the use of rubles to pay for natural gas transactions was a step towards Russia's financial sovereignty.

Brudermuller think, natural gas is irreplaceable both as raw material and energy source of chemicals.

He said that the shortage of natural gas would cause a double blow to the chemical industry. Besides not having enough energy for production, it would also lack key raw materials for manufacturing products.

He pointed out that, the shortage of natural gas will cause a double blow to the production of chemical products. First, the production process will lack sufficient energy, and second, the production of products will lack key raw materials, for the purchased natural gas, 60% of BASF is used as energy in the production process, while the remaining 40% is used as a raw material to produce the required basic chemicals.

In addition, BASF added that natural gas, as a raw material and a source of energy, has no other alternative. If the supply of natural gas falls below half of its demand, BASF will have to stop production. The world's largest chemical group is also one of Germany's largest electricity companies, warning, europe's power shortage will damage its business.

In addition, the German Chemical Industry Association VCI also warned that, germany's chemical and pharmaceutical industries use 2.8 million metric tons of natural gas every year, accounting for more than 25% of Germany's total annual consumption.

VCI pointed out that, since the outbreak of the conflict between Russia and Ukraine, the price of German natural gas has soared 70% without Russian supply, Germany's economy would face major damage. For example, many chemical plants and pharmaceutical plants might face shutdown.

on March 30, local time, the German Chemical Industry Association (VCI) published an article on the impact of gas supply failure on the German chemical industry on its official website.

The article first mentioned, the short-term and long-term supply failure of natural gas will lead to the bottleneck of gas supply in the late autumn, which will lead to a sharp decline in the production level of the whole industry. No matter large energy-intensive companies or medium-sized companies, they will not be spared. On the other hand, the supply shortage in the chemical industry will also spread to the whole manufacturing industry in Germany through the value chain, because almost all living fields and most production sectors, including agriculture, nutrition, automobiles, cosmetics, the production of sanitary products, buildings, pharmaceuticals or electronic products depends on the use of chemicals.

For German chemical industry, natural gas is mainly used as raw materials and energy sources to produce heat and provide electricity. Generally speaking, the whole industry consumes about 140 terawatt hours of natural gas every year. Chemical industry is also the largest industrial consumption industry of natural gas in Germany, accounting for 15%.

Currently, (From January 2022to March 2022) 40% of Germany's natural gas supply still comes from Russia. Due to insufficient global transportation capacity, it is impossible to fully replace the natural gas imported from Russia in the short term.

The overall production structure of chemical industry is complex, and the production site is usually selected in the comprehensive park, that is to say, these production processes are also technically interrelated. Generally, in the integrated operation of chemical industry parks, natural gas is not only used as materials, but also used for power generation and heating to a large extent.

If there is no natural gas as the raw material and generate the necessary process heat, the production plant will have to be closed, whether it is the basic chemical raw material or the subsequent chemical value-added stage (fine and special chemicals, fertilizers, consumption of chemicals and polymers will be unsustainable.

Affected by Russia's possible interruption of natural gas supply, german Economy Minister Robert Habeck issued a statement on March 30, saying that if the government must restrict the supply of natural gas, the German natural gas network regulatory agency will give priority to household heating rather than industrial use, therefore, manufacturers with strong energy demand will be the first to be affected.

In addition, Habeck also said that a working group had been set up to collect relevant data from the industrial field, including natural gas and electricity prices, production plans, supply bottlenecks and dependence on Russian energy.

In order to cope with this "natural gas war", last week Habeck led executives from BASF, Deutsche Bank, Commerzbank of Germany and RWE to Qatar and UAE to ensure the supply of liquefied natural gas.

Previous Wall Street news also mentioned that the Kremlin announced a telephone conversation between Russian President Putin and German Chancellor schortz on March 30.

According to Bloomberg News, the German side understood the conversation between the leaders of both sides and thought Putin said in it that Europe could buy natural gas in euros, the received Russian bank will convert it into rubles.

A German government spokesman said in a statement describing the call Steffen that Putin told Schoultz that after European buyers paid the Russian gas Industrial Bank (Hebestreit) in euros, it will convert the currency into rubles.