Poroshenko threatens Moscow with ‘total destruction’ in gas dispute
“Russia does not respect the law and does not respect the court’s decisions,” Poroshenko complained in what was described as a “late-evening interview” with the Financial Times. The Ukrainian leader apparently referred to the recent decision of the Arbitration Institute of the Stockholm Chamber of Commerce, relating to a dispute between the Russian and Ukrainian energy companies.
The Ukrainian leader went on to say that such disrespect of “international law” would result in Russia being “absolutely destroyed.” In an apparent attempt to add weight to his words, Poroshenko recalled that Kiev already filed several “complaints” against Russia to no less than the UN International Court of Justice itself. They, however, brought no consequences so far, nor anything close to the “destruction” so much anticipated by Poroshenko.
The Ukrainian leader also used his interview with the London-based business daily to once again accuse Russia of all kinds of misdeeds, ranging from the “illegal annexation” of Crimea to being an untrustworthy energy supplier. At the same time, he proclaimed Ukraine as “the most reliable supplier of gas” to Europe, adding that Kiev would not “allow” anybody to challenge that fact.
The president’s words about Ukraine being a gas “supplier” came just as the head of the national energy company Naftogaz, Andrey Kobolyev said at the CERAWeek annual energy conference in Houston, Texas, that Ukraine has not produced its own gas since at least the 1970s. The CEO also accused Ukrainian people of over-consuming gas during “select periods” when Russia’s Gazprom was supplying it.
Earlier, Poroshenko called for national unity in lowering gas consumption and enduring freezing temperatures until spring finally arrives. Despite repeated claims that the country has cut its dependency on Russian energy and was now purchasing only “reverse gas” from Europe, Ukraine had to limit its consumption after the Russian energy giant terminated its contract with the Ukrainian company as the two sides failed to come to an agreement.
Gazprom and Naftogaz have been involved in a bitter dispute since 2014. The argument concerned each side’s view on a contract signed in 2009. Gazprom demanded penalties from Naftogaz for insufficient withdrawal of gas and requested payment of the debt for those shipments that had actually been claimed. The Ukrainian company sought compensation for what it called “lost profit” from the lowered transit of Russian gas to Europe.
The dispute was brought to the Arbitration Institute of the Stockholm Chamber of Commerce. It initially ordered Naftogaz to pay more than $2 billion to Gazprom for the consumed gas. Later, however, it ordered Gazprom to compensate Naftogaz $4.6 billion, citing the changes in “market conditions” which do not allow Ukraine to withdraw and consume the agreed volumes of gas.
Gazprom CEO, Alexey Miller, called the decision “politically motivated” and refused to resolve Ukraine’s downward economic spiral at the company’s expense, announcing a withdrawal from all contracts with Ukraine. The Ukrainian authorities, meanwhile, started to seize assets belonging to Gazprom in what they called a “compliance” with the decision of the Stockholm court.
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