Gazprom cut gas supplies to Ukraine over 600-million-dollar debt

Russia’s gas giant Gazprom informed Ukraine on the reduction of gas shipments to Ukraine by 30 million cubic meters of natural gas a day. After having reduced gas supplies to Ukraine by 25 percent earlier Monday, Gazprom cut them by another 10 percent against the background of the debt dispute between the two countries.

Photo: Gazprom cut gas supplies to Ukraine over 600-million-dollar debt

Ukraine’s Naftogaz said that the cutoff would not affect Ukraine.

Russia demands Ukraine should pay the debt of about 600 million dollars for 1.9 billion cubic meters of natural gas, which Ukraine left unpaid.

“The conflict around the debt to Gazprom is connected with internal matters in Ukraine,” Russia’s Ambassador to Ukraine, Viktor Chernomyrdin said. “Ukrainians should ask their government about the reasons of the current situation,” the official added.

Russia and Ukraine agreed to clear the Ukrainian debt to Gazprom and revise the adequate cooperation between the two countries. It was agreed to set up a new company to import gas from Russia to Ukraine. Gazprom and Ukraine’s Naftogaz would have equal shares of control at the new comany.

Gazprom has accused Ukraine of failing to pay some US$600 million (EUR 395 million) and refusing to sign contracts for future gas deliveries.

The company said consumers in western Europe would not be affected by the cutoff. Gazprom's supply cuts came just hours after its chairman, Dmitry Medvedev, won the Russian presidential election with the support of his mentor President Vladimir Putin.

Putin and Medvedev have increased the Kremlin's control over Gazprom and used it to help energy-rich Russia expand its economic and political influence abroad. The action seemed to suggest that Medvedev will continue Russia's tough stance toward Ukraine, which is seeking closer ties with the West, including NATO membership.