One of the strongest moves yet by the West to punish the Kremlin for recognizing the independence of two regions in Ukraine was announced by the Chancellor on Tuesday.
The German leader's announcement came hours after Putin ordered armed forces to the rebel regions.
Germany's allies in Europe and the United States had been pressing Mr.
The situation today is fundamentally different, according to Mr. Scholz. That includes theNord Stream 2.
Germany's decision was welcomed by the government of Ukraine. Foreign Minister Dmytro Kuleba said it was morally, politically and practically correct.
Since November, the amount of natural gas arriving in Germany from Russia has plunged, driving prices through the roof and draining reserves, leaving all of Europe in an energy crunch. The gas was filled with natural gas but had not gone online pending approval from a German regulator.
The last step before the project was passed on to the regulators was the certification of the project by the Chancellor's government.
The previous government's approval was revoked by Tuesday's announcement, and the project will be re-examined by the economy ministry led by a member of the environmentalist Greens party. Since taking office, both Mr. Scholz and his minister have stressed the importance of broadening Germany's energy sources away from Russian natural gas.
According to government figures, Russian gas accounted for nearly 27 percent of the energy consumed in Germany last year, an increase that was expected to continue after the country shutters its last three nuclear power plants, scheduled in December, and works to phase out coal-burning power plants by 2030.
Russia supplied two-thirds of the gas Germany burned last year.