Russia and Ukraine still deadlocked after gas talks

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(Agencies)
Updated: 2009-01-08 23:27

The European Union has expressed increasing concern at the gas cut-offs. "We need to resume the gas flows in Europe. We can't be blackmailed," Czech Deputy Prime Minister Alexandr Vondra, whose country holds the EU presidency, said in Prague.

The EU is hoping to broker an accord on an EU mission to monitor the flow of Russian gas through Ukraine destined for Europe. A European Commission energy director said on Thursday EU observers would be ready in two days.

The dispute between Kiev and Russia in Moscow follows tensions over Ukraine's efforts to join NATO, a move bitterly opposed by Moscow and viewed with wariness even by European members of the alliance and by investors.

Russian President Dmitry Medvedev spoke by telephone late on Wednesday with Ukrainian President Viktor Yushchenko.

Medvedev told his Ukrainian counterpart gas supplies had become hostage to squabbling in the Kiev leadership and that Moscow would only resume pumping gas for Ukraine's own use if Kiev agreed to pay a market price for the fuel.

Gazprom has said it has increased supplies to the European Union and Turkey via other routes. Despite those measures, the dispute cut Russia's supplies to Europe -- which depends on Moscow for a quarter of its gas supplies -- by half.

The reduction in supplies has been sharper and more prolonged than a similar disruption in January 2006.

The euro zone's major economies have escaped significant economic repercussions, but France has reported a drop in supplies and an Italian industry ministry spokesman said Italy has begun tapping its stockpiles of natural gas.

A total of 18 countries were experiencing supply disruptions. Most were drawing on alternative sources or using stockpiled gas, but with the row in its eighth day, those reserves were dwindling.

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