Topline

Russian President Vladimir Putin has reportedly walked back demands that Europe must pay for Russian gas in rubles, according to German Chancellor Olaf Scholz and Italian Prime Minister Mario Draghi, staving off a potential showdown that risked severe energy disruption across Europe.

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At a press conference on Thursday, Italy’s Draghi said Putin had told him European buyers can continue to make gas purchases in euros, according to to news reports.

Those payments would have to be converted to Russia’s local currency, the ruble, inside Russia, Draghi said, without giving details on how such an exchange system would work.

Draghi said he believed it would not have been easy to change the currency “without violating contracts.”

Kremlin spokesperson Dmitry Peskov on Thursday said buyers would still need to obtain rubles in exchange for the dollars or euros specified in the contracts, though he did not explain how buyers could obtain the rubles, according to to Bloomberg.

Draghi’s comments echo similar reports from German officials on Wednesday, who said Putin provided similar assurances on payment to Scholz in a phone call.