Russia reopens Ukraine gas war

A revival of the natural gas dispute between Russia and Ukraine threatened supplies to western Europe today.

Ukraine threatened cuts in the amount it passes on to the west after Moscow warned it would halve its gas deliveries to the country in a long-running debt dispute.

Yesterday, Russia reduced shipments to Ukraine by about a third and today threatened a further 25% cut.

Much of the gas that western Europe buys from Russia passes through Ukraine pipelines.

A spokesman for Ukraine’s state gas company Naftogaz said it could not rule out cutting supplies. “Europe must also understand to what extent Ukraine can be bent,”he said.

Only about a quarter of the gas imported by Ukraine comes from Russia; although the rest comes from Turkmenistan and Kazakhstan in pipelines controlled by the Russian state supplier Gazprom.

A Gazprom spokesman said another 25% reduction would be imposed at 1700 GMT unless an agreement was signed.

Gazprom portrays the dispute as strictly commercial, but suspicions of a political agenda persist. Gazprom is controlled by the state and its chairman, Dmitry Medvedev, is Russia’s president-elect.

Ukraine, under President Yushchenko, has angered the Kremlin with efforts to move out of Russia’s sphere of influence and become more closely integrated with the West, including pursuing Nato membership.

Gazprom last month threatened to cut supplies to Ukraine over a €978m debt dispute, but agreed a last-minute deal.

However documents formalising that agreement have not been signed by Naftogaz.

The current dispute centred on the controversial middlemen companies that are used in the gas trade, he did not elaborate.

Critics say the laborious arrangement is essentially a mechanism for siphoning money into private pockets and Ukrainian Prime Minister Yulia Tymoshenko has called for direct dealings with Gazprom.