Moscow, Russia - Russian President Vladimir Putin has blasted an agreement by G7 leaders to use frozen Russian assets to help Ukraine as "theft" and promised retaliation.

He said Western powers were still trying to "create at least some legal basis" for the frozen asset decision taken on Thursday.

"But despite all the fuss theft will remain theft. It will not go unpunished," he said in a speech at the Foreign Ministry in Moscow, according to the TASS news agency.

The G7 summit began on Thursday in southern Italy with a deal to lend Ukraine $50 billion using the interest generated from frozen Russian state assets.

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The money is to be made available to Ukraine by the end of the year.

The government says around $280 billion of Russian central bank money has been immobilized in Western countries due to sanctions imposed since the full-scale Russian attack on Ukraine more than two years ago. The bulk of the money is within the European Union.

Kiev is set to use the money to strengthen its defense, pay for the reconstruction of infrastructure, and fund the state budget.

But before it can be disbursed, teams from the G7 countries - the UK, Canada, France, Germany, Italy, Japan, and the US – must clarify the outstanding technical and legal details.