OSLO (REUTERS) - Russia's Gazprom on Saturday (May 21) halted gas exports to neighbouring Finland, the Finnish gas system operator said, the latest escalation of an energy payments dispute with Western nations.

Gazprom Export has demanded that European countries pay for Russian gas supplies in roubles because of sanctions imposed over Moscow's invasion of Ukraine, but Finland refuses to do so.

"Gas imports through Imatra entry point have been stopped,"Gasgrid Finland said in a statement.

Imatra is the entry point for Russian gas into Finland.

Finnish state-owned gas wholesaler Gasum on Friday said Gazprom had warned that flows would be halted from 0400 GMT (noon Singapore time) on Saturday.

Gasum also confirmed on Saturday that the flows has stopped.

"Natural gas supplies to Finland under Gasum's supply contract have been cut off," it said in a statement.

"Starting from today, during the upcoming summer season, Gasum will supply natural gas to its customers from other sources through the Balticconnector pipeline." Balticconnector links Finland to neighbouring Estonia's gas grid.

The majority of gas used in Finland comes from Russia but gas only accounts for about 5 per cent of its annual energy consumption.

Most European supply contracts are denominated in euros or dollars and Moscow already cut off gas to Bulgaria and Poland last month after they refused to comply with the new payment terms.