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Russia's Gas Payment in Rubles Demand a 'Breach of Contract': Germany

Chancellor Olaf Scholz. Bernhard Ludewig (CC BY 2.0)

Russia's demand for payments in rubles for gas deliveries to Europe constitutes a breach of contract, Germany warned Wednesday.

"The announcement of paying in rubles is... a breach of the contract and we will now discuss with our European partners how we would react to that," said German Economy Minister Robert Habeck, whose country imported 55 percent of its natural gas from Russia before Moscow invaded Ukraine.

Calls have been growing for Western allies to further ramp up sanctions against Moscow over its assault on Ukraine through a complete embargo of energy imports from Russia.

But Germany has been reluctant.

Chancellor Olaf Scholz told parliament earlier Wednesday that Europe's biggest economy was accelerating the end of its dependence on Russian oil, coal and gas.

However, to cut it loose from one day to the next would "push our country and the entire Europe in a recession, hundreds of jobs will be in danger, entire industries would be on the brink," warned Scholz.

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