Friday

7th Aug 2020

Gazprom threatens to cut Ukranian gas supplies

Russian energy giant Gazprom has threatened to cut gas supplies to Ukraine unless Kiev pays a €900 million debt by the end of this month – something which could also affect EU gas supplies transiting through Ukraine.

"Bearing in mind the approaching winter season and higher demand for gas, as well as the Ukrainian repeated failures to fulfil gas contracts, Gazprom will have to reduce gas deliveries to Ukrainian consumers if the debt is not settled in October", the company said in a statement.

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  • Most of the Russian gas coming to the EU transits through Ukraine (Photo: gazprom.ru)

The Russian side has respected its share of the contract, while "no real action has been undertaken" on the Ukrainian side, it added.

The European Commission has been notified of the problem and urged both sides "to find a speedy settlement for this issue".

In a dispute over gas prices in 2006, Gazprom temporarily cut supplies to its neighbour, alarming and affecting EU countries which get 80% of their Russian gas supplies through Ukraine.

Ukrainian energy company Naftogaz said it was puzzled and surprised by yesterday's statement by Gazprom.

"We don't understand what Gazprom means. We don't understand where [the sum] came from", Naftogaz spokesman Oleksy Fyodorov told AFP on Tuesday (2 October).

"We hope that by tomorrow, at least, we'll understand what they're talking about and define our position", he added.

Gazprom's move comes just after the pro-Western party of Yulia Tymoshenko and the Party of the Regions of the more Russia-friendly current prime minister Viktor Yanukovych both claimed victory in Sunday's elections.

The forces of the pro-West 2004-2005 Orange Revolution - the Tymoshenko bloc as well as the party of president Viktor Yuschchenko - together account for more than 44% of the votes, prompting some observers to say that Gazprom's move is aimed at influencing the country's political choices.

The Russian company denied the allegations, however. "The problem is objective", Sergei Kupriyanov, Gazprom spokesman was quoted as saying by news agencies.

"It is not connected in any way with who wins or does not win in Ukraine. But it is connected to debts that have to be paid".

The Russian gas company says that recent changes in policy and a rise in prices for former Soviet countries such as Belarus, Ukraine or Georgia – which used to benefit from prices much lower than market prices – represent a shift from Soviet subsidies to a market economy.

But some political analysts believe that Russia is using energy as a political tool towards its former satellites.

The Russian state owns more than 50% of Gazprom. Russia also supplies 30% of Ukraine's gas and 25% of Western Europe's gas.

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