BERLIN, April 1: France and Germany have rejected the Russian demand to make rouble payments for its oil and gas as the contracts stipulate payments only in Euro or dollar.

Russian President Vladimir Putin had said that all EU purchases of Russian gas must be made in roubles starting April 1. "They must open rouble accounts in Russian banks. It is from these accounts that payments will be made for gas delivered starting tomorrow, April 1," Putin said during a televised government meeting.

The Western economic sanctions on Russia have severely hit its stock and money markets, rouble plummeting to the bottom level. The economies of Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan, which are linked to the Russian markets, are also feeling the pinch, especially after a devastating covid pandemic that threw the economy upside down worldwide.

German Economy Minister Robert Habeck on Monday said the Group of Seven (G7) major economies dismissed the Russian demand to pay for gas in rubles. Germany currently holds the G7 presidency.

German Chancellor Olaf Scholz also insisted that "the contracts we know lay down the euro as payment currency and the companies will pay according to the contracts they have signed."

French Minister Bruno Le Maire said both France and Germany are preparing for the eventuality of Russia cutting off the supplies.

With the sanctions in place, the US had banned the import of Russian oil and gas, but the European Union continued the imports. The EU gets almost 40% of its gas and 25% of its oil from Russia.

Under a new US-EU partnership the US would supply 15 billion cubic metres of liquefied natural gas (LNG) to the EU this year.