Germany’s Scholz rejects Putin’s rubles-for-gas demand
German Chancellor Olaf Scholz on Thursday dismissed Russia’s demand that the EU and U.S. pay for Russian gas in rubles, arguing that most existing gas purchase agreements require payment in euros or U.S. dollars.
Russian President Vladimir Putin took the step on Wednesday, challenging Western efforts to punish Moscow for its Ukraine invasion by announcing that so-called “unfriendly” countries — a list including EU countries and the United States — will have to buy Russian gas imports in rubles. The move was seen as an attempt to prop up Russia’s tumbling currency and potentially evade Western penalties.
Yet speaking at a press conference following a summit of the G7 advanced economies in Brussels, Scholz rebuffed Putin’s request.
“We’ve looked at this to try to get an overview. What we have learned so far is that there are fixed contracts everywhere, which include the currency in which payments are made,” Scholz told reporters. “And most of the time it says euro or dollar … and that’s what counts then.”
Germany has attracted particular criticism for rejecting calls to impose an immediate embargo on Russian gas, oil and coal imports, arguing the ban would have a more severe effect on the German and EU economies than on Russia’s leadership.
Scholz also said the G7 — a club comprised of the U.S., Canada, France, Germany, Italy, Japan and the U.K. that is currently led by Germany under a rotating presidency system — reiterated in a joint statement its call for Russia to immediately halt all hostilities. The group also agreed to impose further sanctions if necessary but declined to offer any new measures on Thursday.
“We agree to keep sanctions in place for as long as necessary and to monitor their effectiveness,” Scholz said. “We will react with further sanctions should this become necessary,” he added, without specifying what could be the trigger for additional penalties.