Putin warns Europe over Ukraine gas

Vladimir Putin has told European leaders that Ukraine’s growing gas debts to Moscow can threaten supplies to Europe.

Putin warns Europe over Ukraine gas

Vladimir Putin has told European leaders that Ukraine’s growing gas debts to Moscow can threaten supplies to Europe.

Mr Putin “expressed his utmost concern” to European leaders about the growing gas debts of Ukraine, which Moscow says owes Russia over $16bn.

His press secretary Dmitry Peskov told state news agency RIA Novosti that Mr Putin’s message contained “urgent measures, as the situation requires no delay”.

The move is designed to exert economic pressure on Europe, which receive a large portion of its gas from Russia through Ukraine.

Mr Putin has tightened the economic screws on the cash-strapped Kiev government since it came to power in February, when its Russia-leaning president fled the country after months of protest.

The move raises the spectre of gas disputes between Russia and Ukraine in 2009, when Moscow turned off supplies to Kiev and other European countries.

Prime Minister Dmitry Medvedev said on Wednesday that the Kiev government owes Russia 16.6 billion dollars, mostly for missed gas payments. Last week, Russia state energy giant Gazprom said it would be scrapping all discounts on gas to Ukraine, meaning a 70% price rise that will add to that figure.

Russia had already eliminated a gas discount it had given Ukraine, arguing that it was tied to a lease for Russia’s Black Sea Fleet base in Crimea.

And Ukraine has promised the International Monetary Fund that it will cut energy subsidies to residents in exchange for a bailout loan of up to $14bn. That means gas prices were set to rise 50% on May 1, even before the latest salvo from Mr Putin.

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