Russia Set To Cut Off Ukraine’s Gas Supply Next Month
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Russia’s state gas giant Gazprom has threatened to cut off its supply of natural gas to the Ukraine starting from June 3rd, unless the Ukrainian government pays $1.7 billion in advance for future shipments.
In a statement on Wednesday, Gazprom gave Ukraine a June 2nd deadline to pay the bill, or it would no longer provide any natural gas to the country, which relies on Russia for one-third of its gas needs.
Russia’s state gas giant Gazprom has threatened to cut off its supply of natural gas to the Ukraine starting from June 3rd, unless the Ukrainian government pays $1.7 billion in advance for future shipments.
In a statement on Wednesday, Gazprom gave Ukraine a June 2nd deadline to pay the bill, or it would no longer provide any natural gas to the country, which relies on Russia for one-third of its gas needs.
“Taking into account non-working days, Naftogaz (Ukraine’s state gas company) should pay this bill by June 2 and, starting from June 3, the company will be getting gas … only at the volumes paid for,” Gazprom spokesman Sergei Kupriyanov said.
On Monday, Gazprom’s chief executive Alexey Milller had warned that Russia may cut off the gas supply if Ukraine did not pay up to $3.51 billion in past debt. However the statement on Wednesday suggested that Russia could temporarily overlook the past repayment, as long as Ukraine paid upfront for future gas supplies.
Ukraine is refusing to pay up for the moment, as it wants to change the conditions of a 2009 contract, signed by the last regime, that locked Kiev into buying a set volume of natural, whether it needs it or not, at $485 per thousand cubic metres (tcm) – the highest price paid by any country in Europe.
Moscow dropped the price to $268.50 after then-President Viktor Yanukovich turned his back on a trade and association agreement with the European Union last year but reinstated the original price after Yanukovich was ousted in February.
Ukraine’s Energy Minister Yuri Prodan said that his nation would immediately repay Russia if they dropped the price back to $268.50. “Ukraine in 10 days will urgently repay gas bill arrears,” he said.
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Prime Minister Arseny Yatsenyuk added that he would make a “final call” to Russia to sit down and negotiate a solution to the gas dispute; and would likely take the case to an arbitration court in Stockholm if the two sides failed to agree on a price by May 28.
[quote]”We are ready for a market-based approach and Russia is to stop using natural gas as another, or a new type of Russian weapon,” Yatsenyuk told a news conference with European Commission President Jose Manuel Barroso in Brussels.[/quote]
