Ukrainian PM announces end of gas row

A gas delivery dispute between Russia and Ukraine has been resolved, according to Ukraine's Prime Minister, Yulia Timoshenko. The countries' energy companies Gazprom and Naftogaz are due to make a joint statement. Earlier Gazprom had accused Ukraine of pl

Russia's gas giant has reduced supplies to Ukraine by around half claiming the country has failed to pay a 600 million dollar debt.

Gazprom ready for further talks

Gazprom spokesman Sergey Kupriyanov said the company had received notification from Naftogas stating that Ukraine may start diverting some of the gas destined for Europe for its domestic use.

“Today in Kiev at the meeting of the Ukrainian government there were statements made that gas supplies to the European customers will be delivered in full. At the same time, independent observers are still not being allowed to gas monitoring stations, and Naftogas has sent a message by telephone saying that today supplies intended for European customers will be cut by 60 million cubic metres. That is the volume that will be delivered by Gazprom to the Ukrainian border, but will not reach European customers,” Kupriyanov said.

He also said that despite speculation in some Ukrainian media, Russia has paid for the transit of its gas to Europe in full and that Gazprom had transferred the money for this even before they received all the bills from the Ukrainian company.

Gazprom’s representative also reiterated that the company is ready to continue negotiations with the Ukrainian side and that they are expecting the delegation in Moscow.

Ukraine’s state

At a media briefing Yulia Timoshenko explained why Ukraine has not been paying for the gas consumed by the country in January and February 2008. 

First she said that the previous government didn’t sign new contracts with Russia. Therefore, Ukraine insisted on paying for this gas the price of $US 179 per thousand cubic metres while Russian Gazprom wanted Ukraine to pay $US 314 per thousand cubic metres.

At the moment the position of the Ukrainian government is to insist on paying $US 179 without any direct contract signed, on the basis of a new legal statement signed by the government today.

Yulia Timoshenko has confirmed that Naftogaz officials are in talks with Gazprom over the phone at the moment and a statement is expected in the next couple of hours.

President Yushchenko has not spoken out on this issue yet, but Timoshenko said that the agreements reached by President Yushchenko and President Putin in Moscow two weeks ago were only in words. It seems that it means that she is taking charge of the gas contracts at the moment. She said that there will be no intermediaries and, together with the President Yushchenko, she will come up with a joint decision.