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Gazprom threatens Ukraine gas supply

Latest update : 2008-02-09

Russia's gas export monopoly Gazprom threatened on Thursday to halt gas supplies to Ukraine. Previous pricing disputes have led to cuts in gas supplies to Europe.

Russia's gas export monopoly Gazprom threatened on Thursday to halt gas supplies to Ukraine over $1.5 billion of debt for earlier deliveries. Gazprom, the world's largest gas producer, supplies a quarter of Europe's gas needs via Ukraine and Belarus. Previous pricing disputes have led to cuts in deliveries to Europe, but the EU said Gazprom had given assurances this time.
 

"If the Ukrainian side does not settle the problem on Monday, Gazprom will have to stop supplies of Russian gas to
Ukraine," Gazprom spokesman Sergei Kupriyanov said in a statement. An increasingly assertive Russia has been involved in repeated disputes with the countries through which it ships its gas to Europe and which get Russian gas at subsidised prices.
 

A new Ukraine government has recently sought to revise terms of its gas agreement. Ukraine's pro-Western President Viktor Yushchenko is due to visit Moscow next Tuesday. The disputes raise concerns in Europe over supplies,
particularly in the middle of winter, but the European Commission said Gazprom had given assurances that its dispute
with Ukraine would not affect supplies to the European Union.
 

Some 80 percent of Russia's gas exports to Europe go through Ukraine. "Gazprom has given assurances that gas supplies to the European Union will not be interrupted," EU Energy Commissioner Andris Piebalgs said in a statement.
 

Russian President Vladimir Putin has branded as parasites the energy transit states that have benefited from shipping fees and cheap Russian energy and said Russia should stop subsidising them.
 

But analysts say Russia also wants to ensure it does not harm its reputation as a reliable gas supplier to Europe. Russia imposed the first in a series of steep increases in the price of gas for Ukraine in early 2006. A price dispute then
briefly halted supplies and disrupted flows to Gazprom's European customers.
 

New Ukrainian Prime Minister Yulia Tymoshenko said last month she hoped to negotiate a "just" increase in the tariffs
that Ukraine charges for the transit of Russian gas across its territory.
 

Gazprom's Kupriyanov said Russia had increased gas supplies to Turkey, Greece and Ukraine since the beginning of the year after the countries faced lower deliveries from other suppliers.
 

"All our partners follow payments schedules and it is only with Ukraine that a paradoxical situation has emerged where it
gets the gas it needs, but does not pay for it," he said.

Date created : 2008-02-07

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