Putin wants Europe to pay for Russian gas in euros, not US dollars

President Vladimir Putin said Friday that European nations should pay for Russian gas in euros, as the Kremlin moves to dump the dollar following rounds of US sanctions.

“The euro is completely acceptable for us in terms of gas payments. This can be done, of course, and probably should be done,” Putin said at the Saint Petersburg International Economic Forum.

The Russian leader’s comments come a day after his economy ministry announced it was dropping the dollar from its National Wealth Fund (NWF) and shifting to other currencies.

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The Kremlin has for years worked to wean the economy off the dollar and Russian state-owned energy companies have been turning to non-dollar settlements.

The economy ministry said that from May 20 the share of dollar assets in the fund had been reduced to zero percent from 35 percent.

Finance Minister Anton Siluanov said the euro will make up 40 percent of the fund, with 30 percent in yuan and 20 percent in gold.

The British pound and the Japanese yen will make up five percent each.

Some economists said the move was designed to send a signal to Washington ahead of a summit between Russian leader Vladimir Putin and US President Joe Biden on June 16.

The face-to-face meeting in Geneva comes amid the biggest crisis in ties between the two countries in years, with tensions high over a litany of issues including human rights, election meddling, Ukraine, and Belarus.

Moscow has been reducing the share of its dollar holdings since the West imposed sanctions on Russia following the annexation of Crimea in 2014.

While the US dollar is essential for international trade, it makes Russia more vulnerable to sanctions from Washington.