Moscow, Kiev reach gas deal

Russia and Ukraine will remove all middlemen in their gas trade, Russia's gas export monopoly said yesterday, ending years of opaque schemes which caused tensions between the two neighbours and alarmed investors.

"There is no need for them now after we agreed to supply some volumes to Ukraine's industrial consumers directly and given the upcoming rise in the Central Asian gas price," Gazprom's spokesman Sergei Kupriyanov said.

The move is likely to be hailed by Ukraine's Prime Minister Yulia Tymoshenko, who has demanded Moscow axe all intermediaries saying their role was unclear and led only to gas price increases for Ukraine.