WORLD> Europe
Russia cuts gas supplies to Ukraine
(China Daily/Agencies)
Updated: 2009-01-02 08:35

MOSCOW: Russian gas giant Gazprom cut supplies of all natural gas to Ukraine yesterday morning after talks on payments for past supplies and a new energy price contract for this year broke down.

Gazprom officials said supply was cut as planned at 10 am and the Ukrainian gas company Naftogaz confirmed a steady drop in supplies.

The festering dispute between the two neighbors raised fears that a cut-off could lead to a repetition of the January 2006 gas crisis, when a similar dispute between them briefly interrupted gas shipments to many European countries.

Europeans get about a quarter of their gas from Russia, and Ukraine controls the pipelines through which Moscow supplies most of its customers in Europe. Natural gas is used for heating and to generate electricity, and the cut-off to Ukraine comes when Europe is approaching the height of winter.

Though Gazprom cut supplies to Ukraine, it said it had increased the amount of gas pumped through pipelines that mainly serve Europe.

Russian Prime Minister Vladimir Putin has warned Ukraine against diverting gas intended for other countries.

Ukraine's president and prime minister issued a statement saying they would guarantee the uninterrupted transit of natural gas through Ukrainian territory to Europe.

Naftogaz director Oleh Dubina said Ukraine has enough gas in reserve to last it through early April.

European countries, too, have built up their gas storage since the 2006 crisis and are unlikely to see any disruption for several weeks, said Chris Weafer, chief strategist at Uralsib Bank.

Agencies