Market Loop - Russian rouble payment deadline nears

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31st March 2022

Bite-sized business news from the UK and beyond

Good morning Could the next Facebook be on the way? A new social media app billed as the “anti-Instagram” is taking UK and US universities by storm. BeReal prompts users at a different time every day to share a picture of the most mundane parts of their day.

Today's stories

Russian rouble payment deadline nears
UK meal replacement startup hits £100m in sales

RUSSIA
Russian rouble payment deadline nears

What’s going on?
Russia has set today as the deadline for so-called “unfriendly countries” to pay for its gas in roubles instead of the usual payment currency of euros and dollars.

Why is this important?

Russia is targeting “unfriendly countries” including the UK, US and EU nations that imposed sanctions on the country following its invasion of Ukraine back in February.

Last week President Putin said that Russian gas would have to be paid for in roubles by 31 March. So far the EU has rejected the idea saying that it breaches the contracts in place which state either euro or dollar payments.

Paying in roubles could help boost the currency’s value, which dropped to record lows after the war in Ukraine began but has since begun to recover.

Russia hasn’t said what will happen if its demands are not met, but a government spokesman suggested that gas deliveries could be cut short. This would be disastrous for the EU that receives 40% of its gas supply from Russia, compared to the UK that only gets 3%.

But countries are preparing for that eventuality. Yesterday Germany and Austria, which get 50% and 80% of their gas from Russia respectively, announced plans to ration gas with households and businesses being urged to curb their consumption.

Canada have agreed to send more oil to the Europe this year, but it’s not nearly enough to offset Russia’s supply.

Zooming out

Although the EU has signalled that it wants to become less reliant on Russian energy in the future, this will take time, in the short term it needs Russian gas to fuel its economy. Russia gets €400m a day from gas sales to the EU and it has no way of redirecting this supply to other countries.

So how will this play out? Both sides are heavily dependent on each other so it will be a case of who “blinks first”.

Analysts predict that some sort of compromise will be reached by redrawing contracts, as both sides have an interest in resolving the stand-off.

Other stories to keep you in the loop

One in five ‘would struggle to cope in a cashless society’
Surging living costs force Britons to work past retirement age
London arm of sanctioned Russian bank VTB close to collapse
Ikea plans to close Tottenham branch, putting 450 jobs at risk
Price of avocados surges to a record high
British Airways hit again by 'technical' failure that has delayed flights
London rental platform Goodlord raises £27m

FOOD
UK meal replacement startup hits £100m in sales

Huel, the plant based food brand known for its all-in-one shakes, posted a 43% jump in revenues to £103m last year.

Growth came from the home market in the UK and internationally where the company sells in 100 countries.

Founded in 2015, Huel – a mix of the words ‘human’ and ‘fuel’ – creates nutritionally complete and sustainable food that can help people lose weight. It recently expanded into other plant-based foods such as energy bars and grain bowls which are are particularly popular with health-conscious millennials.

The company website claims loyal customers, known as “Hueligans”, who use Huel products can save themselves five hours of meal preparation time a week.

Huel has high-profile investors including Dragon’s Den star Steven Bartlett who sits on the company’s board. Its last known valuation was at over £200m in 2018 but in 2019 the company said that on its own growth predictions, it expected to be valued at £760m by 2022.

So what’s next for Huel? Rumours have been circulating that the company could list on the stock market as soon as this year. But the company says an IPO is just one of several options it's exploring.

Stat of the day

Chris Rock’s comedy-tour ticket sales have surged, with minimum prices up nearly 8x from before the Oscars

Interesting links from around the web

The ‘coasting’ workers who’ve checked out of their jobs
Why you should take a meter reading before tomorrow
Former Google employee claims there’s a dark reason behind free office perks like dinner

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Market Loop - Russian rouble payment deadline nears

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