European nations will have to pay for gas supplies from Russia in roubles, after the country’s President Vladimir Putin signed an order enforcing the requirements on foreign buyers.
Putin has threatened that agreed contracts with other countries will be halted if payments are not made from rouble accounts in Russian banks.
In a televised appearance, he said: “It is from those accounts that gas will be paid for, starting 1 April. If such payments aren’t made, we will consider this a failure by the client to comply with its obligations.”
The move is considered a retaliatory measure after the West imposed heavy sancions on Russia this month, following its invasion of Ukraine.
His decision was first proposed last week, and has helped boost the Russian currency from historic lows.
Germany and Austria have triggered emergency gas plans this week, amid fears of supply shortages.
The European Union relies on Russia for around 40 per cent of its gas supplies and has so far avoided hitting the country with energy sanctions.
While the developments are not completely surprising – Putin reportedly reassured Germany would be able to continue paying in euros for supplies.