UPDATED ON:
Friday, February 29, 2008
22:18 Mecca time, 19:18 GMT
 
News Europe
Gazprom to cut Ukraine gas supply
Russian natural gas accounts for around a quarter of Ukraine's gas imports [AFP]
Gazprom, the Russian state gas company, is to cut its supplies to is neighbour Ukraine by 25 per cent on Monday after talks between the two countries over gas debts ended in failure.
 
Sergei Kupriyanov, a Gazprom spokesman, said that its European partners, who receive much of their gas through Ukraine, had been informed of the situation.
He said: "Considering that the situation has reached a dead end, to guarantee its own economic interests, Gazprom will reduce its gas supplies to Ukrainian consumers by 25 per cent on March 3 at 10:00 (07:00 GMT).
"Talks with the Ukrainian side, which took place on Thursday and Friday, did not bring any results."
 
Kupriyanov later told Russia's Interfax news agency that Gazprom was ready to continue talks with its Ukrainian counterpart, Naftogaz Ukraine, but was unsure if the Ukrainian side would agree to participate.
 
Supply shortages
 
The dispute echoes a price row that led to a brief cut-off of Russian gas to Ukraine in 2006, which in turn led to supply shortages in the European Union.
 
Russian natural gas accounts for around a quarter of Ukraine's gas imports, with the rest coming from former Soviet republics in Central Asia via pipelines that go through Russia.
 
The rift over debts for gas imported in 2007 and 2008, comes less than three weeks after Russia and Ukraine had claimed to have reached a deal to resolve the row.
 
Under the deal, Moscow agreed to a Ukrainian demand to replace two controversial intermediary gas trading companies with a more transparent enterprise.
 
Changes to the complicated system of intermediaries by which Ukraine pays for gas imported from Russia and via Russia from Central Asia had been a key demand by Yulia Tymoshenko, Ukraine's prime minister.
 
However, disagreements remained over a debt Moscow claims Ukraine accumulated in recent months when Russia used its own gas to fill a shortfall in deliveries from Central Asia.
 Source: Agencies
 
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