NEW YORK – Russia over the last year has sold off one-third of its U.S. Treasury holdings, according to records released by the Treasury Department and the Federal Reserve Board.

In March 2013, Moscow had U.S. Treasury holdings of $153 billion. By March 2014, the figure had been reduced to $100.4 billion.

In March alone, Russia sold off nearly $26 billion of U.S. Treasuries,.

International financial analysts widely interpreted the move as Russia’s response to economic sanctions the Obama administration imposed as punishment for taking over Crimea and threatening military intervention in Ukraine.

The war on the petrodollar that WND first reported April 12 appears to be gaining momentum.

The Voice of Russia reported May 13 that Russia’s Ministry of Finance is ready to give a green light to a plan to increase radically the role of the Russian ruble in export operations while reducing the share of Russia’s dollar-denominated transactions.

The Voice of Russia report detailed a “de-dollarization meeting” chaired by First Deputy Prime Minister of the Russian Federation Igor Shuvalov, involving top level experts from Russia’s energy sector, banks and governmental agencies.

The report speculated that Russia could begin implementing the policy to move away from the petrodollar by working more closely with Iran and China, with Vladimir Putin in Beijing May 20 preparing to sign pending oil and gas contracts

Reuters reported Thursday that Russia plans to sign a contract with Iran this year to build two more nuclear reactors at Iran’s Bushehr power plant as part of a larger deal in which Russia proposes to build up to eight reactors in the Islamic nation.

On Wednesday, the Financial Times in London reported Russian President Vladimir Putin and Chinese President Xi Jinping signed a $400 billion deal in which Russia’s Gazprom agreed to supply China’s largest oil company, China National Petroleum Corp., with up to 38 billion cubic meters of natural gas annually for 30 years, beginning in 2018.

While the Financial Times did not report details of the energy agreement, Forbes interpreted the timing of the conclusion of 10 years of negotiation between Russia and China to be an indication Moscow intends to look increasingly to Beijing for international financing to replace Western money withheld in the U.S.-imposed economic sanctions.

RT reported the deal Russia and China signed in Shanghai Wednesday included some 40 separate business contracts. One specified that Russia’s second largest bank, VTB, had agreed with the Bank of China to bypass the dollar and pay each other in domestic currencies. The side agreement could mean, as has been widely speculated in the Russian press, that the $400 billion energy deal between the two countries would be denominated not in dollars but in the domestic currencies of the two nations.

The Russian news service RIA Novosti reported that Moscow has prepared a “confidential document” with measures responding to Western sanctions, citing Kremlin adviser Andrew Belousov.

“I can say that, while it is not a strategy, we do have a tactic,” Belousov was cited telling TV channel Russia 24. “It is in the form of a document which for understandable reasons is confidential. But it clearly lists the Russian sanctions: focusing on individuals, companies, sectors, whether they are comprehensive and systemic, and if they impact the banking system.”

WND reported in April economist Peter Koenig, a former staff member of the World Bank, warned Russia was in the process of abandoning the “petro-dollar” as the trading unit for oil and gas transactions, with Russian hydrocarbon trade estimated at approximately a trillion dollars per year.

“The main supporters of this plan are Sergey Glaziev, the economic aide of the Russian president, and Igor Sechin, the CEO of Rosneft, the biggest Russian oil company and a close ally of Vladimir Putin,” noted Voice of Russia radio on April 4. “Both have been very vocal in their quest to replace the dollar with the Russian ruble. Now, several top Russian officials are pushing the plan forward.”

On March 21, in advance of the deal reached Wednesday in Shanghai, Reuters reported Russia and China were close to finalizing a “Holy Grail” deal in which the Russian state-owned gas firm Gazprom plans to pump 38 billion cubic meters of natural gas per year to China starting in 2018. The gas will be pumped the first pipeline between the world’s largest supplier of natural gas to the world’s largest user of natural gas. The transactions will be valued in rubles, Russia’s currency, and remnimbi, China’s international currency, or possibly in gold.

Belgium: a mystery buyer of U.S. Treasuries

As Russia has begun dumping U.S. Treasuries, Belgium has stepped up as a mystery buyer.

According to the records released May 15 by the Treasury Department and the Federal Reserve Board, Belgium has moved to become the third largest foreign national purchaser of U.S. Treasuries, behind communist China and Japan, with Belgium increasing its holdings of U.S. Treasuries from $188.4 billion in March 2013 to $381.4 billion a year later, in March 2014.

A close examination of the Treasury Department/Federal Reserve table makes clear that Belgium’s holdings of U.S. Treasuries had been relatively stable, in the range of $188 billion, until Belgium began stepping up purchases of U.S. Treasuries in November 2013. As 2014 began, Belgium for the first time held over $300 billion of U.S. Treasuries, with January recorded at $310.3 billion.

The widely followed Zero Hedge blog observing that at the end of 2013 Belgium had a Gross Domestic Product, or GDP, of just over 100 billion euros.

“And somehow the Treasury expects us to believe that Belgium – the center of the doomed Eurozone which is all to busy running a debt ponzi scheme of its own – bought in two months nearly as much U.S. Treasuries as its entire GDP? Apparently, yes. However we are not that naïve. So our question is: just who is Belgium being used as a front for?”

Zero Hedge reminded readers that for years, the “UK” designation on the U.S. Treasury holdings report generated by Treasury and the Federal Reserve was a designation used to mask offshore accounts transacted on behalf of China.

Equally baffled was the Wall Street Journal’s Market Watch, which reported April 15 that Belgium accounted for 80 percent of the total increase in foreign holdings of Treasury debt in 2013, according to Stone & McCarthy Research Associates.

While the consensus among experienced watchers of international finance was that Belgium was being used to create custodial holdings of Treasury debt, the agent behind the transactions remained a mystery.

What is not a mystery is that Russia, as it engages in selling off U.S. Treasuries, has stepped up buying gold.

On May 21, Goldcore reported that Russia’s central bank bought 900,000 ounces of gold worth $1.17 billion in April.

Goldcore, citing Bloomberg data on central bank reserves, demonstrates Russia’s gold reserves rose to 34.4 million troy ounces in April, from 33.5 million troy ounces in March. The value of Russia’s central bank gold holdings rose to $44.30 billion as of May 1, compared with $43.36 billion a month earlier.

Gold as a percentage of overall Russian reserves is now 10 percent, historically high for Russia, but still below gold holdings as a percentage of major central banks such as the Bundesbank, Bank of France and the Federal Reserve, which fall in the range of 65 percent for gold holdings as a percentage of overall reserves.