Russia's Chairman of Gazprom Board, Dmitry Medvedev attends the annual general meeting of the company's shareholders, 29 Jun 2007

Russia's state-run natural gas monopoly Gazprom has warned Ukraine that it will reduce supplies to that country if Kyiv fails to pay more than $1 billion  it owes by the end of the month.

A Gazprom statement says Russia has fully complied with its contract on deliveries to Ukraine.

But it says that country's debt has topped $1.3 billion. The firm says it has informed its European clients of the problem.

In Brussels, the European Commission urged a speedy settlement of the issue.

The announcement triggered memories of a January 2006 price dispute when Gazprom halted natural gas shipments to Ukraine. That sharply reduced the flow of gas to European Union countries that depend on Russia for a quarter of their supplies. Russia responded by accusing Ukraine of siphoning off gas being shipped to qestern Europe through Ukrainian pipelines.

Some information for this report was provided by AFP, AP and Reuters.