Russian President Vladimir Putin has issued a warning on Thursday, stating that Russia may exit the Black Sea grain deal if its demands are not fulfilled. The agreement is set to expire on Monday.
During an on-camera interview with journalist Pavel Zarubin, Putin expressed his perspective, saying, “As one of the options, let’s not start with the extension and then the fulfillment of promises, but first the fulfillment of promises and then our participation.” He further added, “We can suspend our participation in this deal, and if everyone once again says that all the promises made to us will be fulfilled, well, let them fulfill these promises, and we will immediately join this deal again.”
One of Russia’s key demands is to gain access to international payment mechanisms that are currently restricted for Russian banks due to international sanctions. Putin highlighted that the interests of the Russian Federation have not been addressed in the deal, despite voluntarily extending it multiple times. He emphasized that it is now time to see the promised commitments fulfilled.
In an effort to keep the deal intact, United Nations Secretary-General Antonio Guterres sent a letter to Putin this week, presenting a proposal. The proposal aims to resolve the obstacles affecting financial transactions through the Russian agricultural bank, which is a major concern expressed by Russia, while maintaining the flow of Ukrainian grain through the Black Sea.
It is important to note that the Russian Foreign Ministry had previously rejected a proposed formula that involved creating a subsidiary of a Russian bank to connect with the international financial system.
The Black Sea grain deal, established by Turkey and the UN, enables the shipment of Ukrainian wheat and other crops to international markets through secure corridors. Although global supplies are not as constrained as they were last year, traders anticipate a rise in prices if the deal is not renewed.
While alternative routes for Ukrainian grain and oilseed exports exist via rail through Eastern Europe, they are not adequately equipped to handle the desired export volume. Romania has made efforts to refurbish rail links and storage facilities, but its main port is already congested with waiting ships. These factors underscore the importance of renewing the Black Sea grain deal to ensure the smooth export of Ukrainian grain and maintain stability in global food markets.