Ukraine
to buy cheaper Russian gas for next three months
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[April 02, 2015]
By Pavel Polityuk and Natalia Zinets
KIEV (Reuters) - Ukraine has signed an
interim deal for cheaper supplies of gas from Russia for the next three
months, providing a breathing space for both sides in their protracted
wrangle over pricing, Ukrainian energy officials said on Thursday.
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Previous gas disputes between Ukraine and Russia have affected the
European Union, where Gazprom covers a third of gas demand. Around
40 percent of that gas travels via Ukraine.
The lower agreed price for Russian gas at the start of the
off-season in Ukraine, when consumption is much reduced because of
warmer weather, had been heavily flagged by Moscow and came as no
surprise for Ukrainian energy officials who saw it as reflecting
lower global oil prices.
Ukraine's energy ministry said Kiev would buy Russian gas at $248
per thousand cubic meters during the April-June quarter while.
This compares with $329 per thousand cubic meters which it has been
paying under a winter package. That package, which carried a price
discount of $100 per thousand cubic meters and a requirement for
advance payment, expired on Tuesday.
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Ukrainian officials also saw signs of goodwill in relations between
Ukraine's state gas concern Naftogaz and Russia's Gazprom <GAZP.MM>
as they tried to work out a lasting solution to a dispute which has
been soured politically by Russian support for separatists in
Ukraine's east.
The two sides are bound by a 10-year gas agreement signed in 2009
and which successive Kiev governments say locked Kiev into an
onerous pricing system way above the market level.
Kiev is challenging the price of Russian gas, and billions of
dollars in debts which Russia says have accrued, and appealing to an
arbitration court in Stockholm for a definitive ruling.
Apart from the price, the new temporary agreement extended all the
other terms of the winter package, the energy ministry said in a
statement.
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The agreement represented a "victory" for an economic approach to
relations between Naftogaz and Gazprom over a political one, Energy
Minister Volodymyr Demchyshyn was quoted as saying on his ministry's
website.
Ukrainian officials are particularly pleased that there is no
"take-or-pay" clause locking Ukraine into importing specific volumes
of Russian gas.
"Gas should be sold on commercial principles," Naftogaz chief
executive Andriy Kobolev said in a statement. "This short-term
extension of the winter package gives the parties additional time to
develop a longer-term solution."
But a requirement for advance payment for gas by Ukraine, whose
economy teeters on the edge of bankruptcy, will stay in place.
Though Russian President Vladimir Putin said on Tuesday that Russia
would extend a gas price discount for Ukraine into the second
quarter, he was quoted by Russian media as saying that any further
decisions would be taken in three months and depend on the price of
oil.
(Additional reporting by Natalia Zinets; Writing By Richard
Balmforth, editing by William Hardy)
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