Open

Coming up

Don't miss

Replay


LATEST SHOWS

THE WORLD THIS WEEK

The World This Week - July 25th, 2014

Read more

AFRICA NEWS

Search of Air Algerie crash site continues

Read more

MEDIAWATCH

Sarkozy, Hollande and the scooter wars

Read more

MEDIAWATCH

Confusion online over Air Algérie flight

Read more

THE WORLD THIS WEEK

The World This Week - July 25th, 2014 (part 2)

Read more

REPORTERS

Halal tourism on the rise

Read more

ENCORE!

Tunisia's Carthage International Festival turns 50

Read more

FRANCE IN FOCUS

WWI Centenary: the battle for Verdun

Read more

THE BUSINESS INTERVIEW

When big companies want to do good

Read more

  • France calls on its nationals to leave Libya as violence escalates

    Read more

  • Boko Haram kidnap Cameroon minister's wife in deadly attack

    Read more

  • Nibali joins elite group with Tour de France win

    Read more

  • Netanyahu says Hamas 'violating its own ceasefire'

    Read more

  • Muslims prepare for Eid al-Fitr festival

    Read more

  • ‘Irresponsible’ American dad tries to scale Mont Blanc with children

    Read more

  • Ukraine fighting prevents observers from accessing MH17 crash site

    Read more

  • In pictures: Crowds flock to enjoy the Tour de France show

    Read more

  • Video: At the scene of the Air Algérie crash in Mali

    Read more

  • Costa Concordia arrives in port of Genoa to be scrapped

    Read more

  • In pictures: Youths clash with police at banned Gaza protest

    Read more

  • Russia lashes out at new EU sanctions over Ukraine

    Read more

  • Bodies of all Air Algérie crash victims to be brought to France

    Read more

  • Syrian army and ISIS both claim advances

    Read more

  • Briton kidnapped in Yemen freed after five months

    Read more

  • Nibali rides serenely toward a place in Tour history

    Read more

  • Germany's Tony Martin wins 20th stage of Tour de France

    Read more

  • New round of Gaza ceasefire talks takes place in Paris

    Read more

Europe

Russian gas reaches European countries

Video by Sophie DAVIDSON

Latest update : 2009-01-20

Russian gas reached several European countries, including Slovakia and Hungary, after Russia and Ukraine reached an agreement on gas transit. Some additional countries may need to wait until Wednesday to receive their gas flow.

Click here to read "Gazprom's (very kitsch) anthem" from our Observers


REUTERS - Russian gas reached Europe via Ukraine for the first time in two weeks on Tuesday after Moscow and Kiev ended a contract row that cut supplies to about 20 European countries.

Slovakia and Hungary said they had begun receiving gas, though pipeline operators said it could be Wednesday before supplies reach other parts of Europe, where the cut-off forced some countries to ration supplies to customers in midwinter.

"Gas is not only flowing in the direction of Europe but it is flowing to Europe," Alexander Medvedev, deputy chief executive of Russian gas export monopoly Gazprom, said on a conference call with reporters.

Ukraine confirmed it was receiving gas from Russia and said it would deliver it to Europe as quickly as possible.

The gas transmission arm of Hungarian oil and gas group MOL said it started receiving Russian gas via Ukraine at 1220 GMT. Slovakian Economy Minister Lubomir Jahnatek said supplies had started arriving there too.

The gas dispute had reflected political tension between Moscow and Kiev, with Russia opposed to formerly Soviet Ukraine's aspirations to join the NATO military alliance.

Even once gas flows return to normal, the effects are likely to linger. Russia's reliability as an energy source is under renewed scrutiny and Europe is anxious to diversify suppliers so it cannot become hostage again to local disputes.

European Commission President Jose Manuel Barroso said he was considering taking legal action over the dispute.

"We must not allow ourselves to be placed in this position in future. This cannot become an annual event. We have to stop simply talking about energy security in Europe, and start doing something about it," he told a news conference in Brussels.

Gazprom said that, under the new contract, Ukraine would pay $360 per 1,000 cubic metres of gas in the first quarter of this year, double the $179.50 that Kiev was paying for Russian gas last year.

The new price is likely to come down later this year as gas tracks falling oil prices, but it could still be a huge burden for a Ukrainian economy struggling with debt and sharp falls in the hryvnia currency.

Ukrainian Prime Minister Yulia Tymoshenko said on Monday she expected the average price over this year to be around $230-250 per 1,000 cubic metres.


Domestic rivalry

Gazprom Chief Executive Alexei Miller warned if Ukraine were to fall behind in its payments, the firm would raise the price and demand Kiev pay for all its gas in advance -- sanctions that could cripple the fragile Ukrainian economy.

Fears persist that political infighting in Kiev could cause the deal to unravel. Aides to Ukrainian President Viktor Yushchenko, a bitter rival to Tymoshenko, accused her of signing an agreement that would hurt the economy.

But Yushchenko's deputy chief of staff, Oleksander Shlapak, said the president lacked the legal authority to annul the deal.

Austrian oil and gas group OMV said Russian gas could reach its hub in Baumgarten, near Slovakia, on Wednesday and a Turkish Energy Ministry source said the flow of Russian gas into should be back to normal on Thursday.

Oil prices fell to just over $33 a barrel on Tuesday, partly in response to the resumption of gas supplies. The gas disruptions had driven up demand for oil products, used as alternatives to gas in heating and power generation.

Russia provides about a quarter of Europe's gas requirements and pumps 80 percent of this via Ukraine.

In Bulgaria, almost entirely dependent on Russian energy, many households were left without adequate heating and hundreds of firms have had to scale down production.

"The impacts on the Bulgarian economy are catastrophic," Economy and Energy Minister Petar Dimitrov told Reuters in an interview. " ... the impact very much resembles that of a terrorist attack."

Russia cut flows to Ukraine itself on Jan. 1 after the two sides failed to agree a 2009 supply contract. Six days later, export flows to Europe through Ukraine also ceased after Russia accused Kiev of siphoning off gas intended for export.

Ukraine denied stealing gas, and countered that Moscow was trying to blackmail European customers by halting gas supplies.

Date created : 2009-01-20

COMMENT(S)