MOSCOW, RAW – Russian President Vladimir Putin says he has signed a decree saying foreign buyers must pay in roubles for Russian gas from April 1 and contracts would be halted if these payments were not made.

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

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

Putin’s decision to enforce rouble payments for gas has boosted the Russian currency, which fell to historic lows when the US and its European allies applied sweeping sanctions after he sent his army into Ukraine on February 24.

But foreign companies and governments have rejected the move as a breach of existing contracts, which are set in euros or US dollars.

European nations, some of which rely heavily on Russian gas, have rejected the demand and Germany’s government said it amounted to “blackmail”.

Putin said the switch was meant to strengthen Russia’s sovereignty, and it would stick to its obligations on all contracts.

The US State Department said the move was a sign of Moscow’s economic and financial “desperation” caused by Western sanctions.

“I think fundamentally this is just another indication of the dire straits that Russia’s economy is in,” spokesman Ned Price told reporters at a regular media briefing, adding it was up to European nations to determine their response.