Germany says it will continue to pay for Russian gas in euros

BERLIN (AA) - German companies will continue to pay for Russian gas in euros, Chancellor Olaf Scholz said on Thursday.

Speaking at a news conference in Berlin, Scholz insisted that Russian President Vladimir Putin’s demand for gas payments in rubles is not in line with the existing contracts.

“We looked at the contracts, they state that payments can be made in euros, and sometimes in dollars,” Scholz said, adding that he discussed this issue during a phone call with Putin on Wednesday.

“In my discussion with the Russian president, I made it clear that this is how it will continue,” he stressed.

Scholz did not rule out further discussions with Putin on his suggestions, but underlined that German energy companies and gas importers will not make payments in rubles.

“Certainly, as for the companies concerned, they want to pay in euros, this is what they can and will do,” he said.

Scholz reiterated that Germany will continue to take major steps to reduce its energy dependence on Russia, and could be in a position to stop oil and coal imports later this year.

But he acknowledged that finding alternatives to Russian gas would likely to take longer.

Until recently, Russia was supplying 55% of Germany’s natural gas, 35% of its crude oil, and 45% of its coal.

In response to Western sanctions, Putin signed a decree on Thursday, laying out the rules for trading Russian natural gas with the “unfriendly countries.”

He said Russia will halt gas supplies to these countries if they do not switch to payments in rubles as of Friday.

“To purchase Russian natural gas, they must open ruble accounts in Russian banks. It is from these accounts that the gas will be paid for starting on April 1," he said.

Russia’s war on Ukraine, which started on Feb. 24, has been met with international outrage, with the EU, US, and the UK, among others, implementing tough financial sanctions on Moscow.

At least 1,232 civilians have been killed in Ukraine and 1,935 injured, according to estimates by the UN, which cautioned that the true figure is likely far higher.

More than 4 million Ukrainians have also fled to several European countries, with millions more displaced inside the country, the UN refugee agency said.