Foreign buyers of Russian gas could have to pay in rubles starting April 1, according to a decree signed Thursday by Russian President Vladimir Putin.

Refusing to pay in the Russian currency will result in the suspension of contracts, Putin said.

The decree targets the United States, the United Kingdom and European Union countries, which Putin calls “unfriendly.”

“In order to purchase Russian natural gas, they must open ruble accounts in Russian banks. It is from these accounts that payments will be made for gas delivered starting from tomorrow,” Putin said in a television appearance.

“If such payments are not made, we will consider this a default on the part of buyers, with all the ensuing consequences,” the Russia leader said. “Nobody sells us anything for free, and we are not going to do charity either — that is, existing contracts will be stopped.”

Despite the strong words, Italian Prime Minister Mario Draghi and German Chancellor Olaf Scholz reportedly said they had spoken to Putin and were told existing contracts will remain in place.

Western governments and companies have called the proposed move a breach of already existing contracts, which stipulates payments should be made in euros or dollars.

The move to force ruble payments is seen as retaliation for the vast array of sanctions the West and other countries have placed on Russia since its invasion of Ukraine last month.

Europe gets about one-third of its gas from Russia.

The value of the ruble plummeted at the beginning of the war but has rebounded to near pre-war levels.

Some information in this report comes from Reuters.
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