Putin should think about the consequences of asking for energy payments in rubles, Germany says

Germany has some advice for Putin, think about the consequences of asking for energy payments in rubles.

Putin said last week that nations would be asked to pay for their natural gas in rubles, causing a spike in European gas prices.

Putin wants to prop up the value of the rubles by asking for payments in the Russian currency, rather than in dollars or euros. The Russian ruble has fallen against the U.S. dollar since the beginning of the Ukrainian crisis.

Christian Lindner said he wouldn't be strong-armed by Russian demands.

We are against any kind of blackmailing. Lindner told CNBC that private sector companies should pay Russia in euro or dollar.

It is open to Putin to think about consequences if he is not willing to accept this.

Germany's Chancellor said last week that paying for oil in rubles would be a violation of a contract, and Italian officials said they would not be paying in rubles as it would help Russia avoid Western sanctions.

The flow of natural gas from Russia to Europe could be disrupted by disagreements over future payments. The region gets about 40% of its gas imports from Russia, and this figure is even higher for some European nations, notably Hungary, which got almost all of its gas imports from Russia in 2020.

The White House has banned Russian oil and gas imports as part of its sanctions regime, but the region's dependency on Russian energy has prevented it from imposing an oil embargo on Moscow.

The European Union will change its approach to Russian energy. A plan was put forward earlier this month to cut Russian gas imports by two-thirds by the end of the year.

We will find solutions. Lindner said that if Putin decided to cut his supplies, we would have to be even faster to be independent from Russia.

The region is looking for a new source of energy. The United States and the European Union have a new deal to supply 15 billion liters of natural gas this year.