As the story goes, Scott agreed to play Wolverine after some pressure from X-Men director Bryan Singer. Speaking with ET Canada, an interview that will come up again later, Scott said he turned down the opportunity three times before committing.
At the time, it was understood that he would be able to fulfill his obligations to Mission: Impossible 2 where he played the villain Sean Ambrose before transitioning over to X-Men. But for some reason, that plan went awry. ScreenRant speculates that the script being in a constant state of flux caused creative differences among decision makers, which delayed the shooting schedule, and ultimately made Scott unavailable to film X-Men.
When Scott pulled out of X-Men, the studio moved quickly to find a new Wolverine, and approached a relatively unknown actor named Hugh Jackman, who was recommended by fellow Australian and Singer's first choice Russell Crowe. In that aforementioned ET Canada interview, Scott said at the 7:30 mark below, Cruise was "reluctant" about letting him go before Mission: Impossible 2 was finished filming.
Now, Scott is putting the blame squarely on his M:I 2 co-star's shoulders. "Tom Cruise didn't let me do it," he told The Daily Telegraph. "We were doing Mission: Impossible and he was like, 'You've got to stay and finish the film' and I said, 'I will, but I'll go and do that as well.' For whatever reason he said I couldn't."
"He was a very powerful guy," Scott added. "Other people were doing everything to make it work."
The Mission: Impossible franchise and its distributor Paramount Pictures playing hardball when their actors have other work commitments doesn't seem out of the norm. Mission: Impossible – Fallout director Chris McQuarrie said on the Empire podcast in 2018 that he and DC producer Charles Roven negotiated a $3 million payout for his visual effects team which would allow Henry Cavill to shave his mustache, and film reshoots for Justice League. Paramount executives pulled the plug on the deal, forcing Warner Bros. to find a workaround, and we know how that turned out.
As for Scott, despite the Wolverine fallout, he's effusive in his praise of Jackman and his portrayal of the character. "I love what Hugh did with it," he said. "He's a lovely guy."