European spot gas prices jumped almost 20% on Wednesday in anticipation of the impending reduction in Russian gas supplies to the continent following the sudden announcement by Russia President Vladimir Putin on changing payment terms for European buyers.

According to the ICE commodity exchange in London, contracts for spot gas supplies in April rose to almost €118 per megawatt per hour, or about $1500 per 1000 cubic metres.

During a meeting with members of the Russian government broadcasted on state television, Putin instructed the government and state controlled gas giant Gazprom to begin the work of switching payments for delivered Russian gas to rubles from Euro and US Dollars, with the change effective for customers in “unfriendly countries”.