Sunday

22nd Jan 2017

Russian gas supplies 'not guaranteed', EU commissioner warns

  • Guenther Oettinger at a press conference after meeting the Russian and Ukrainian energy ministers (Photo: European Commission)

A first mediation attempt by the EU between Russia and Ukraine on their gas price dispute on Friday (2 May) in Warsaw ended with no results other than the willingness to meet again.

"It is with concern that we see the security of supply for end consumers in EU and non-EU states like Ukraine is not guaranteed," EU energy commissioner Guenther Oettinger told press after the meeting.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

The energy ministers of Ukraine and Russia, for the first time at a table since the annexation of Crimea and the Russia-backed separatist movements in eastern Ukraine, decided to hold separate press points rather than join Oettinger in a common press conference.

Still, when asked about the atmosphere in the meeting, Oettinger responded that "we are all adults" and emphasised the willingness of both sides to meet again mid-May.

"The European Commission will stabilise Naftogaz [Ukraine's state-owned gas company] and Ukraine and will be a fair mediator for justified and fair gas prices," Oettinger said.

At the core of the current dispute is how much Ukraine owes and has to pay for current and future gas deliveries from Russia: 485 US dollars per cubic meter of gas as Gazprom demands or roughly half of it, the price Kiev used to pay before the political turmoil that started late last year.

For the Russian side, the price is "clear, set in the contract signed until 2019" and any negotiations are "odd".

Russian energy minister Alexander Novak told press after the meeting that Ukraine has not paid for any gas it imported in the last quarter of 2013 and the first three months of this year.

"There is a 16 May deadline when an invoice will be issued to pay for the gas by 31 May and to prepay for the consumption in June. If by June these payments are not made, Gazprom will have the possibility to restrict supplies to Ukraine," Novak said.

He added that European supplies should not be affected as they are paid for until September 2014. Any disruptions in gas flows to the EU during this time should only be blamed on Ukraine, if it "illegally" taps these supplies or diverts them to storage.

Novak also questioned plans by the EU to reverse the flow of gas and supply Ukraine with Russian gas via Slovakia.

"If such contracts are executed, we'll look at them very attentively and reserve our right to address courts and institutions of arbitration," he said.

As for Ukraine, its energy minister Yuriy Prodan said the doubling of the gas price by Russia was "discriminatory" and "abusive" and that Kiev will take the matter to the international court of arbitration in Stockholm.

"It is possible that in arbitration we can change the volume of our debt to Gazprom, possibly no debt at all," Prodan said.

He insisted that "Ukraine is a reliable partner, a transit country and it will fulfil all its obligations to its European partners."

Ukraine is the main transit country for Russian gas supplies to EU countries, with previous price disputes having translated into gas cuts at the height of cold winters, leaving citizens in Bulgaria and Slovakia in the cold.

The situation has since improved, with increased reserves and the capacity to reverse the gas flow from less-dependent EU countries to the ones totally relying on Russian imports.

But with pro-Russian separatists shooting down two Ukrainian helicopters and with Russian President Vladimir Putin declaring a Geneva peace deal "no longer valid", the chances of a solution to the gas dispute are low.

Kerry to EU: Believe in yourself

Outgoing US secretary of state gives EU short pep talk from Davos, hailing its peaceful and economic success. 'It's worked, folks', he said.

Moldova turns from EU to Russia

Moldova's president said he would like to scrap an EU treaty and has started preparations to join a Russia-led bloc.

Stakeholders' Highlights

  1. Caritas EuropaEU States to Join Pope Francis’s Appeal to Care for Migrant Children
  2. UNICEFNumber of Unaccompanied Children Arriving by sea to Italy Doubles in 2016
  3. Nordic Council of Ministers"Nordic Matters" Help Forge Closer Bonds Between the UK and the Nordic Region
  4. Computers, Privacy & Data ProtectionThe age of Intelligent Machines: join the Conference on 25-27 January 2017
  5. Martens CentreNo Better way to Lift Your Monday Blues Than to Gloss Over our Political Cartoons
  6. Dialogue PlatformThe Gulen Movement: An Islamic Response to Terror as a Global Challenge
  7. European Free AllianceMinority Rights and Autonomy are a European Normality
  8. Swedish EnterprisesHow to Create EU Competitiveness Post-Brexit? Seminar on January 24th
  9. European Jewish CongressSchulz to be Awarded the European Medal for Tolerance for his Stand Against Populism
  10. Nordic Council of Ministers"Adventures in Moominland" Kick Off Nordic Matters Festival in London
  11. PLATO15 Fully-Funded PhDs Across Europe on the Post-Crisis Legitimacy of the EU - Apply Now!
  12. Dialogue PlatformInterview: Fethullah Gulen Condemns Assassination of Russian Ambassador to Turkey