Russia’s main exporters will continue to be required to convert foreign currency into rubles

In the two years since the West imposed sweeping financial sanctions in response to Russia’s military offensive in Ukraine, Moscow has imposed tight capital controls to prop up the ruble’s value.

On Saturday, the Russian government said it had decided that rules requiring at least 80 percent of Russia’s 43 largest raw materials and commodities groups must convert their income in foreign currency into rubles, valid for another year – until the end of April 2025.

“This decision will help maintain the stability of the exchange rate and the resilience of the Russian financial market,” the government said in a statement.

Russia introduced the forced sale of foreign currency for the first time in February 2022.

This happened shortly after the West froze about $300 billion. US dollars (280 billion euros) of Russia’s international reserves and essentially banned the country’s main banks from conducting international trade.

These measures by the Russian government, which increased the demand for the ruble during a period of great economic uncertainty, helped to avoid a depreciation of the national currency and a major financial crisis.

During 2022 and 2023, Moscow gradually relaxed these rules.

But after the ruble began to fluctuate more sharply again and crossed the 100-ruble-per-US-dollar mark, Russian President Vladimir Putin re-introduced a six-month mandatory sale of the currency last October.

“This measure has proven to be effective,” the government said on Saturday.

“It helped to stabilize the situation in the domestic foreign exchange market by ensuring a sufficient level of liquidity.”

Currently, the ruble exchange rate is around 93 rubles per US dollar.

The government also announced on Saturday that the deadline for companies to convert their income in foreign currency will be extended from 90 to 120 days.