No Signs of Gas Dispute Ending Between Russia, Ukraine

By Anya Ardayeva

Moscow
10 January 2009

Deliveries of Russian gas to Europe remain suspended after negotiations on Friday aimed at agreeing on a mechanism to monitor gas flow through Ukraine failed to bring any result. Russian state-run energy firm Gasprom, which has pledged to resume deliveries to Europe once the deal is signed, has said Ukraine disrupted Friday's talks. Kyiv, meanwhile, is saying that Ukraine is prepared to sign a deal on a monitoring mechanism as soon as possible.

Millions of Europeans are left shivering in some of the coldest temperatures of the winter so far, as Russia, which supplies one-quarter of all gas consumed in European Union countries, continues to halt deliveries of its gas.

Moscow cut its supplies to Ukraine on January first following a price dispute and on Wednesday, it also stopped all shipments to Europe through pipelines running across Ukraine, accusing Ukrainian authorities of stealing gas.

The Ukrainian president Victor Yushchenko strongly denied Russia's charges strongly denied Russia's charges and said that Ukraine did not steal one cubic meter of Russian gas.

European gas line monitors arrived in Kyiv on Friday morning. Filip Cornelis, who head of group said, "The purpose of our monitoring mission is to verify on an independent basis the flows of gas coming into the Ukrainian system and be able to compare them on an independent basis with the precise flows of gas that reach the European customers with whom Gazprom has commercial contracts."

Russia pledged to resume the pipeline delivery of Russian gas across the territory of Ukraine after independent monitors are installed. Gazprom's CEO Alexei Miller pledged Gazprom would resume shipments to Europe once the monitoring teams deploy to pipeline-pumping stations across Ukraine.

Now Russian President Dmitri Medvedev insists that they could not proceed until Moscow and Kyiv sign a protocol on how the mission will operate. Negotiations on developing such mechanism failed on Friday.

President Medvedev said Moscow had no trust left in the good intentions of the Ukrainian side and that Russia will act only after the documents are signed.

Czech Prime Minister Mirek Topolanek, whose country holds the rotating EU presidency, is in Moscow meeting with Russian leaders Saturday after overseeing Friday's negotiations in Kyiv.

Moscow wants Ukraine to pay the full market price for gas without the discount Ukraine has enjoyed since the Soviet Union collapsed in 1991. But Ukraine, which is struggling through economic crisis, says Russia wants double what Ukraine is prepared to pay. Moscow's last offer was 250 U.S. dollars for a cubic meter of gas, but Gazprom said the offer no longer stands after Ukraine rejected it and that it will charge Ukraine $450.

EU authorities have warned that even after Moscow resumes gas shipments, it will take at least three days before the deliveries reach all EU member countries.