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Ukraine, Russia take up deepening gas row
(AFP)
Updated: 2005-12-28 09:17
The presidents of Ukraine and Russia discussed a deepening dispute between their countries over gas prices and supplies, a standoff nervously eyed in western Europe, which depends on the two nations for a large part of its gas imports.
Russia's Vladimir Putin and Ukraine's Viktor Yushchenko discussed the row during a telephone call and agreed that the Ukrainian fuel and energy minister would visit Moscow for further negotiations on the dispute on Wednesday, said a statement from the Ukrainian presidency.
Yushchenko reiterated his earlier stance that Kiev "is in favor of liberalizing prices for supplies and transit of Russian gas and that a formula for these prices should be based on European principles," the statement said.
Russia wants to more than quadruple the price it charges Ukraine for gas to bring it in line with world market rates as of January 1. Kiev has been arguing for a phased increase over several years.
Tuesday's conversation came after the two nations exchanged another round of verbal salvoes in their increasingly rancorous gas dispute, and against a looming January 1 deadline that Moscow has set for Kiev to either agree to a price hike or face a cutoff of gas supplies.
'Blackmail on gas won't cut it!' shout people during a rally at the Russian embassy in Kiev organised by Congress of Ukrainian Nationalists. [AFP] |
Western Europe is closely following the row as nearly one fifth of its gas imports come from Russia via Ukraine.
Tuesday's exchanges were sparked when Ukraine's Prime Minister Yury Yekhanurov insisted that Kiev had a contractual right to take 15 percent of Russia's gas exports bound for Europe that pass through Ukrainian territory.
"If a thousand cubic meters pass through Ukraine's borders, then 150 of them are ours as payment for gas transit," Yekhanurov told Ukrainian television.
"That is what's written in the contract, that is the legal formula and that is our uncontested right, Ukraine's legal right. We take 15 percent of gas for transit through our territory."
Russia's state-owned Gazprom monopoly slammed the statement.
"This irresponsible and legally ignorant announcement is aimed at escalating tension in Russian-Ukrainian relations and undermines Europe's trust in Ukraine as a transit country," it said in a statement.
"All of Ukraine's actions on siphoning off gas after January 1, 2006 will be regarded as... theft," said Sergei Kupriyanov, a Gazprom spokesman.
Viktor Yushchenko (R) with Russian President Vladimir Putin in Kazan, in August 2005.[AFP] |
"All responsibility for shortage of Russian gas supplies to European customers will lie completely with the Ukrainian side," he said.
Russia's Industry and Energy Minister Viktor Khristenko in his turn said that Russia would make no more offers to Ukraine on a new pricing agreement.
Meanwhile Ukraine's ex-premier and formerly a powerful businesswoman in the gas sector, Yulia Tymoshenko, urged Kiev to stand firm, arguing that the dispute was "a cold shower which should have Ukraine realize where her interests lie and learn to defend herself."
"We must not sign any contracts or agreements with Russia. As of now our financial balance layouts until 2009 have us get gas for 50 dollars per 1,000 cubic meters," Tymoshenko said as quoted by the ITAR-TASS news agency, adding that "whoever signs this will be a traitor to Ukraine."
Moscow has said that if a new agreement on gas prices is not signed before the new year, it would stop supplies to the Ukrainian domestic market, a move that would leave Ukraine without about a third of its annual energy needs.
The opposing statements from Kiev and Moscow stem from different interpretations of two agreements that currently regulate the gas market between the two countries -- an intergovernmental protocol renewed every year and a long-term contract between the nations' state-owned energy firms.
Russia says that if the government protocol is not signed before January 1, it will not have a legal basis for supplying gas to Ukraine.
Ukraine says that if the protocol is not signed, the terms of the long-term contract between Russia's Gazprom and Ukraine's Naftogaz will remain in force.
These terms lay out a barter system, under which Russia has provided Ukraine with gas as transit fees for its European gas exports, with a base price of 50 dollars (42 euros) per 1,000 cubic meters (35,316 cubic feet).
Russia wants to switch to cash payments and bring the price of Ukrainian gas supplies to world market levels, which it says are around 220-230 dollars per 1,000 cubic meters.
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