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Russia cuts Ukraine's gas, Europe not affected: Gazprom
MOSCOW
Petroleumworld.com, Mar 03, 2008Russia on Monday cut gas supplies to ex-Soviet neighbour Ukraine by 25 percent after talks in a pricing dispute failed, but supplies to Europe will not be affected, Russian gas monopoly Gazprom said.
"To ensure its economic interests, Gazprom from 10:00 am (0700 GMT) today reduced gas supplies to Ukrainian consumers by 25 percent," spokesman Sergei Kupriyanov said in a statement.
Although Ukraine is the main transit route for Russian gas supplies to the European Union, "deliveries to European consumers are continuing and will continue at full capacity," he said.
The dispute echoes one in 2006 in which Russia briefly cut supplies to Ukraine, leading to knock-on disruption in several European countries.In that dispute Moscow accused Ukraine of diverting supplies destined for Europe to fill its shortfall, but a spokesman for Ukrainian state gas company Naftogaz said Monday that would not happen this time around.
Ukraine "would not collect gas earmarked for deliveries to Europe," spokesman Valentin Zemlyansky said. "We have reserves to compensate for this fall," he said.
Gazprom said supplies would be cut by 40 million cubic meters per day, while Zemlyansky said Naftogaz had received a telegram from Gazprom to inform it of a cut in deliveries of 30 million cubic meters per day.
Kupriyanov said the latest dispute centres on 1.9 billion cubic metres of gas deliveries worth about 600 million dollars (395 million euros) that Ukraine has not paid.
" Unregulated use of gas continues in Ukraine. The necessary contracts have still not been signed," Kupriyanov said, while insisting Gazprom remained open to further talks.
The cut comes despite a February 12 announcement by the presidents of the two ex-Soviet neighbours, Vladimir Putin and Viktor Yushchenko, that the differences had been resolved.
Under that deal, Moscow agreed to a Ukrainian demand to replace two controversial intermediary gas trading companies with a more transparent firm.
However, disagreements remain over a debt Moscow says Ukraine accumulated in recent months when Russia used its own gas to make up for a shortfall in less expensive Central Asian gas.
Russian natural gas accounts for around a quarter of Ukraine's gas imports, with the rest coming from former Soviet republics in Central Asia via pipelines that go through Russia.
In the past Moscow has been criticized for cutting supplies to neighbouring countries in pricing disputes that critics say are often politically motivated.
But Gazprom chairman Dmitry Medvedev, who won Sunday's election to replace President Vladimir Putin, has defended the company's actions.
Earlier this month he said foreign clients should get used to paying Gazprom's rates since gas is not "a freebie that comes in pretty plastic pipes."
Story by Conor Humphries from AFP
AFP 03 0943 GMT 03 08Copyright© 2008 respective author or news agency. All rights reserved.
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