Europe suffers gas cuts after Russia move
Updated: 2006-01-02 10:08
MOSCOW (Reuters) - European countries were enduring reduced gas supplies at
the height of winter on Monday after Russia halted its deliveries to Ukraine,
stirring fears about the use of energy as a political weapon.
Russia, taking over
the G8 chairmanship for the first time this month and aiming to promote itself
as a reliable energy source, cut its neighbor's gas supplies on Sunday after
Kiev refused Moscow's demand for a fourfold price rise.
A gauge is seen at
a Ukrainian main pipeline in the village of Boyarka near the capital Kiev
January 1, 2006. [Reuters]
Moscow said it had no choice but to act after Kiev refused to sign a new
contract that would have ended the preferential price treatment of the Soviet
Washington stepped into the row, the State Department saying it regretted
"Such an abrupt step creates insecurity in the energy sector in the region
and raises serious questions about the use of energy to exert political
pressure," State Department spokesman Sean McCormack said in a statement.
Pipelines taking Russian gas to European countries cross Ukraine, and the cut
in supplies to Ukraine quickly affected central Europe, with Austria, Hungary
and Poland all reporting sharply reduced deliveries.
The Kremlin says the dispute is a purely commercial matter. But Kiev sees it
as an attempt to undermine its pro-Western government and says cutting Ukrainian
supplies will undermine deliveries passing through the same pipeline complex to
Western Europe, where demand is near peak levels because of freezing weather,
imports 25 percent of its gas from Russia, most of it delivered by pipelines
running across Ukraine.
The Russian state monopoly, Gazprom, said enough gas was still being piped
via Ukraine to meet its commitments to other countries, and if they were not
getting all their gas, Ukraine must be diverting it.
AUSTRIAN SUPPLY DROPS
The Austrian oil and gas group OMV said Russian gas supplies had dropped
overnight and were now down by about one third, but that it could use reserves
to cover the loss.
Hungary's gas wholesaler MOL said its Russian deliveries via Ukraine had
fallen by more than 40 percent. It had already told big consumers to switch to
oil where possible and said it would cut deliveries to Serbia and Bosnia by more
than 40 percent. Poland said its supplies were down by 14 percent.