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GISMETEO.RU
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Nation    

Ukraine suspending Russian natgas imports
Journal Staff Report

KIEV, June 30 - Ukraine will suspend all Russian natural gas imports on Wednesday, following Russia's refusal to lower its gas prices, Naftogaz Ukrayiny, the national energy company, said on Tuesday.

Supplies from Russia to Europe via Ukrainian territory will keep running unaffected, the company said.

The development comes immediately after Ukraine and Russia failed to reach a new natural gas supply deal at talks in Vienna. The deal was supposed to replace an agreement that was to expire by the end of the day on Tuesday.

"Since the additional agreement between Naftogaz and Gazprom is expiring on June 30, and the terms of further Russian gas deliveries to Ukraine were not agreed at today's trilateral talks in Vienna, Naftogaz is suspending purchases from the Russian company," the Ukrainian firm said in a statement.

This is the second time that Russian gas supplies to Ukraine are suspended over the past 12 months, and is caused by disagreement on gas prices among other things.

Russian Prime Minister Dmitry Medvedev said Russia will continue to charge Ukraine $247.17/1,000 cubic meters for gas supplies in the third quarter, unchanged from the second quarter.

The price suggested by Medvedev is higher compared with what Ukraine has been expecting in the third quarter.

Ukraine has been seeking the price at about $205-207 per 1,000 cu m in the third quarter, according to Ukrainian Energy and Coal Industry Minister Volodymyr Demchyshyn.

Russian President Vladimir Putin said June 24 that Russia will not be providing Ukraine with the same size discount on gas as in the first two quarters.

Ukraine also insisted on the deal to cover the period through the end of the high-demand season in April 2016, according to Naftogaz Ukrayiny, the national energy company.

“The effective solution to the gas issue with Russia should be trilateral, binding and fixing provisional agreements on all contentious issues at least through the end of the 1st quarter of 2016,” Naftogaz said.

Russia has earlier insisted that it was ready to discuss the deal that would cover gas supplies through the end of the third quarter.

A short-term deal, as opposed to a long-term deal, gives Russia an opportunity to increase political pressure on Ukraine ahead of the winter, when demand for energy increases, a Ukrainian government official said.

The meeting in Vienna includes representatives of the European Commission that are keen to make sure the deal is signed to prevent possible disruptions of gas supplies from Russia to Europe via Ukraine.

Naftogaz, in the statement, mentioned the need to sign the trilateral agreement, which would also include the EC, an indication that Russia has been refusing to do so at the meeting.

“Ukraine insists on signing the deal in the form of a trilateral protocol by the ministries of energy of Ukraine and Russia, and by the European Commission, which must ensure responsible implementation of the deal by all parties.”

Naftogaz said the same principle was used in October 2014 when Ukraine, Russia and the EC signed the so-called winter package, an agreement that had ensured Russian gas supplies to Ukraine through the winter. (nr/ez)




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