News / Europe

Russia's Gazprom Gives Kyiv Extension Into Next Week in Gas Dispute

FILE - Workers stand near pipes at a gas compressor station near Uzhhorod May 21, 2014. FILE - Workers stand near pipes at a gas compressor station near Uzhhorod May 21, 2014.
FILE - Workers stand near pipes at a gas compressor station near Uzhhorod May 21, 2014.
FILE - Workers stand near pipes at a gas compressor station near Uzhhorod May 21, 2014.
Russia's Gazprom gave Ukraine on Monday an extension into next week to resolve a gas price dispute at the heart of the two countries' confrontation, a day before Moscow was due to switch off the gas unless Kyiv paid in advance.
The argument over prices for natural gas has quietly simmered in the background even as the two countries have squared off over Moscow's seizure of Ukraine's Crimea peninsula and over a pro-Russian rebel uprising in eastern Ukraine.
Since a pro-Moscow president was toppled in Ukraine in February, Russia has demanded a sharp increase in the price Ukraine pays for gas. Kyiv says it cannot afford it and wants to pay a discounted price which it negotiated in the past.
While the dispute has gone on, Gazprom has continued billing Kyiv at the higher rate. It says Ukraine already owes it more than $5 billion in unpaid bills and is running up more debt at a rate of more than $1 billion per month.
Moscow had previously threatened to switch off Ukraine's gas as soon as this Tuesday unless it began paying up front for supplies, a measure that could potentially have also hit European supplies shipped through Ukrainian pipes.
But after Kyiv paid some of its gas debt, Gazprom announced a six-day extension of the deadline until June 9. Gazprom also said that it would not sue Ukraine's gas supplier Naftogaz over unpaid bills during the coming week.
“Payment for May should be done before June 9,” Gazprom CEO Alexei Miller said in a statement.
That means gas will continue to flow to Ukraine and Europe while President Vladimir Putin and other world leaders - including Ukraine's new president-elect Petro Poroshenko - are in France this week for events commemorating the allied forces' “D-Day” landings in Normandy during World War II.
The Kremlin has announced no plans for talks with Poroshenko or U.S. President Barack Obama during Putin's visit on Thursday and Friday but has said it cannot rule out the possibility of informal meetings. They are all due to attend a lunch on June 6.
Putin has pulled back some of the tens of thousands of troops he had massed on Ukraine's border and says he is prepared to work with Poroshenko, who won a landslide presidential election a week ago. But the past week has also seen a sharp increase in violence in eastern Ukraine, with dozens of pro-Moscow rebel fighters killed in a government assault, most of them Russians whose bodies were sent back across the border.
More talks

Talks between the Russian gas exporter and Ukraine were due to resume later on Monday in Brussels, under the auspices of the European Union.
EU mediator Guenther Oettinger said on Friday a $786 million partial payment for back gas bills was on its way to Moscow, clearing the way for further talks on Monday.
Gazprom confirmed on Monday that it had received the payment.
The delicate negotiations over gas supplies worth billions of dollars provide the economic backdrop for the crisis in Ukraine, which has led to the biggest confrontation between the West and Russia since the Cold War.
Ukraine's industry-heavy economy depends on Russian natural gas to be competitive. Since the fall of the Soviet Union in 1991, Moscow has frequently used its control over energy resources to influence politics.
Kyiv wants to return to a discount gas price of $268.50 per 1,000 cubic meters while Moscow is demanding $485 - the highest paid by any client, which Kyiv says would effectively bankrupt it. Most European countries are believed to pay Russia around $300-$400 for gas, although the prices are not published.
Gazprom's Miller said that averting the requirement for prepayment for gas would depend on whether Kyiv pays off the remaining $2.24 billion for deliveries from before April 1 and makes “progress” in paying off for April and May.
“The Russian side would be ready to look into the resolution of the pricing scheme issue through cuts in exports custom duty” if Ukraine settles all its bills, he said.
Europe gets a third of its gas needs from Russia, and almost half of these supplies are sent via Ukraine. On Monday, Gazprom said gas was flowing to Europe as usual.
The debt Moscow says Kyiv already owes is equivalent to around 3 percent of Ukraine's GDP. Delaying an agreement will make it increasingly difficult for already cash-starved Ukraine to meet its obligations.
Moscow's leverage is blunted somewhat because the peak winter demand season is now over and storage tanks across Europe are full. Past pricing disputes between Moscow and Kiev in 2006 and 2009 took place during times of peak winter demand, causing shortages and freezing across Europe.
But following a mild winter and spring as well as healthy supplies from non-Russian sources such as Norway and Qatar, Europe's gas storage sites are well filled this year.
The healthy supply is reflected in wholesale prices, which have fallen 30 percent since the start of the Ukraine crisis in late February to the lowest levels since 2010.

You May Like

Video Americans, Tourists, Reflect on Meaning of Thanksgiving

VOA garnered opinions from several people soon after November 13 Paris attacks, which colored many of their thoughts

Video Thais Send Security Concerns Down the River

In northern Thailand, the annual tradition of constructing floating baskets to carry away the year’s bad spirits highlights the Loy Krathong festival

Video Tree Houses - A Branch of American Dream

Workshops aimed at teaching people how to build tree houses have become widely popular in America in recent years

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Belgium-Germany Border Remains Porous, Even As Manhunt For Paris Attacker Continuesi
Ayesha Tanzeem
November 25, 2015 10:46 PM
One of the suspected gunmen in the Nov. 13 Paris attacks, Salah Abdeslam, evaded law enforcement, made his way to Belgium, and is now believed to have fled to Germany. VOA correspondent Ayesha Tanzeem makes the journey across the border from Belgium into Germany to see how porous the borders really are.

Video Belgium-Germany Border Remains Porous, Even As Manhunt For Paris Attacker Continues

One of the suspected gunmen in the Nov. 13 Paris attacks, Salah Abdeslam, evaded law enforcement, made his way to Belgium, and is now believed to have fled to Germany. VOA correspondent Ayesha Tanzeem makes the journey across the border from Belgium into Germany to see how porous the borders really are.

Video Islamic State Unfazed by Losses in Iraq, Syria

Progress in the U.S.-led effort to beat Islamic State on its home turf in Iraq and Syria has led some to speculate the terror group may be growing desperate. But counterterror officials say that is not the case, and warn the recent spate of terror attacks is merely part of the group’s evolution. VOA National Security correspondent Jeff Seldin has more.

Video Taiwan Looks for Role in South China Sea Dispute

The Taiwanese government is one of several that claims territory in the hotly contested South China Sea, but Taipei has long been sidelined in the dispute, overshadowed by China. Now, as the Philippines challenges Beijing’s claims in an international court at The Hague, Taipei is looking to publicly assert its claims. VOA’s Bill Ide has more from Beijing.

Video Syrian Refugees in US Express Concern for Those Left Behind

Syrian immigrants in the United States are concerned about the negative tide of public opinion and the politicians who want to block a U.S. plan to accept 10,000 Syrian refugees. Zlatica Hoke reports many Americans are fighting to dispel suspicions linking refugees to terrorists.

Video After Paris Attacks, France Steps Up Fight Against IS

The November 13 Paris attacks have drawn increased attention to Syria, where many of the suspected perpetrators are said to have received training. French President Francois Hollande is working to build a broad international coalition to defeat Islamic State in Syria and in Iraq. Zlatica Hoke reports.

Video US, Cambodian Navies Pair Up in Gulf of Thailand

The U.S. Navy has deployed one of its newest and most advanced ships to Cambodia to conduct joint training drills in the Gulf of Thailand. Riding hull-to-hull with Cambodian ships, the seamen of the USS Fort Worth are executing joint-training drills that will help build relations in Southeast Asia. David Boyle reports for VOA from Preah Sihanouk province.

Video Americans Sharpen Focus on Terrorism

Washington will be quieter than usual this week due to the Thanksgiving holiday, even as Americans across the nation register heightened concerns over possible terrorist threats. VOA’s Michael Bowman reports new polling data from ABC News and the Washington Post newspaper show an electorate increasingly focused on security issues after the deadly Islamic State attacks in Paris.

Video World Leaders Head to Paris for Climate Deal

Heads of state from nearly 80 countries are heading to Paris (November 30-December 11) to craft a global climate change agreement. The new accord will replace the Kyoto Protocol on Climate Change that expired in 2012.

Video Uncertain Future for Syrian Refugee Resettlement in Illinois

For the trickle of Syrian refugees finding new homes in the Midwest city of Chicago, the call to end resettlement in many U.S. states is adding another dimension to their long journey fleeing war. Organizations working to help them integrate say the backlash since the Paris attacks is both harming and helping their efforts to provide refugees sanctuary. VOA's Kane Farabaugh reports.

Video Creating Physical Virtual Reality With Tiny Drones

As many computer gamers know, virtual reality is a three-dimensional picture, projected inside special googles. It can fool your brain into thinking the computer world is the real world. But If you try to touch it, it’s not there. Now Canadian researchers say it may be possible to create a physical virtual reality using tiny drones. VOA’s George Putic reports.

Video New American Indian Village Takes Visitors Back in Time

There is precious little opportunity to experience what life was like in the United States before its colonization by European settlers. Now, an American Indian village built in a park outside Washington is taking visitors back in time to experience the way of life of America's indigenous people. Carol Pearson narrates this report from VOA's June Soh.

Video Even With Hometown Liberated, Yazidi Refugees Fear Return

While the northern Iraqi town of Sinjar has been liberated from Islamic State forces, it's not clear whether Yazidi residents who fled the militants will now return home. VOA’s Mahmut Bozarslan talked with Yazidis, a religious and ethnic minority, at a Turkish refugee camp in Diyarbakır. Robert Raffaele narrates his report.

Video Nairobi Tailors Make Pope Francis’ Vestments

To ensure the pope is properly attired during his visit, the Kenya Conference of Catholic Bishops asked the Dolly Craft Sewing Project in the Nairobi slum of Kangemi to make the pope's vestments, the garments he will wear during the various ceremonies. Jill Craig reports.

Video Cross-Border Terrorism Puts Europe’s Passport-Free Travel in Doubt

The fallout from the Islamic State terror attacks in Paris has put the future of Europe’s passport-free travel area, known as the "Schengen Zone," in doubt. Several of the perpetrators were known to intelligence agencies, but were not intercepted. Henry Ridgwell reports from London European ministers are to hold an emergency meeting Friday in Brussels to look at ways of improving security.

Video El Niño Brings Unexpected Fish From Mexico to California

Fish in an unexpected spectrum of sizes, shapes and colors are moving north, through El Niño's warm currents from Mexican waters to the Pacific Ocean off California’s coast. El Nino is the periodic warming of the eastern and central Pacific Ocean. As Faiza Elmasry tells us, this phenomenon thrills scientists and gives anglers the chance of a once-in-a-lifetime big catch. Faith Lapidus narrates.

Video Terrorism in Many Forms Continues to Plague Africa

While the world's attention is on Paris in the wake of Friday night's deadly attacks, terrorism from various sides remains a looming threat in many African countries. Nigerian cities have been targeted this week by attacks many believe were staged by the violent Islamist group Boko Haram. In addition, residents in many regions are forced to flee their homes as they are terrorized by armed militias. Zlatica Hoke reports.

Video Study: Underage Marriage Rate Higher for Females in Pakistan

While attitudes about the societal role of females in Pakistan are evolving, research by child advocacy group Plan International suggests that underage marriage of girls remains a particularly big issue in the country. VOA’s Ayesha Tanzeem reports how such marriages leads to further social problems.

VOA Blogs