"It is very sad when Germany makes a massive oil and gas deal with Russia, where we're supposed to be guarding against Russia, and Germany goes and pays out billions and billions of dollars a year to Russia", the President said.
Before arriving a half hour late to the final day of meetings on Thursday, Trump tweeted that "the USA pays tens of Billions of Dollars too much to subsidize Europe", that Germany's oil and gas pipeline with Russian Federation is "not acceptable", and that allies must not only all reach the 2 percent defense spending guideline, but double that to 4 percent.
"Many countries in North Atlantic Treaty Organisation, which we are expected to defend, are not only short of their current commitment of 2% (which is low), but are also delinquent for many years in payments that have not been made", he tweeted while his plane was in the air.
"They're going to try to put the best face on everything, but I think as people, as Americans, we have a responsibility for leadership and I hope the president will really uphold that when he meets one on one with Vladimir Putin", he continued.
Merkel said she welcomed the chance to have an "exchange of views" with Trump.
Germany, Europe's biggest economy, spends just 1.24%, compared with 3.5% for the US. Currently, Merkel is struggling to hold together a weak coalition government.
Mr Trump said the agreement to bump spending would be worth more than $US33 billion.
UK's new Brexit strategy won't inhibit trade deals: minister
But many pro-Brexit lawmakers are furious at a plan they say will stop Britain forging an independent economic course. The Conservatives now have 316 MPs so 48 of them would need to write such letters to challenge May.
In a move that echoed his contentious departure from the G7 summit in Quebec, Trump later posted a tweet that appeared to contradict the communique, insisting countries should "pay two per cent of GDP immediately, not by 2025".
U.S. President Donald Trump, left, and German Chancellor Angela Merkel pose for a photograph prior to a bilateral meeting on the eve of the G-20 summit in Hamburg, northern Germany, Thursday, July 6, 2017.
Trump began his trip here by scolding allies over breakfast Wednesday with NATO Secretary General Jens Stoltenberg.
Praising new initiatives to build capacity, NATO Secretary General Stoltenberg estimated that as much as 266 billion additional USA dollars would be spent by European allies and Canada on defense by 2024.
EU President Donald Tusk stepped up to the fight with his own salvo against Trump on Tuesday, telling him to "appreciate your allies" and reminding him Washington that Europe had come to its aid following the 9/11 attacks.
German news agency DPA, Politico and The Times of London reported the US President had openly threatened that the US would "do our own thing" unless the wealthiest allies were spending 2 per cent of their GDP on defence by January.
The meeting brought together Mr Trump and Canada's prime minister Justin Trudeau, who irritated the U.S. president at the G7 by declaring that his country would not be pushed around.