Ukraine Braces for a Winter Without Russian Gas
Days after an EU-brokered deal was set to give Ukrainians access to Russian gas for the winter, Ukrainian officials continue to for fight for a previously agreed upon discount.
Days after an EU-brokered deal was set to give Ukrainians access to Russian gas for the winter, Ukraine is now balking at the price tag and preparing for the oncoming frost.
The deal, the details of which were announced on Friday, required Ukraine to pay $3.1 billion to Russia by the end of the year. "In exchange," The Times explains, "Gazprom will ensure that at least 5 billion cubic meters of gas are supplied to Ukraine from October to March at the set price of $385 per 1,000 cubic meters, which must be prepaid before delivery."
Despite the approach of the cold (and all those adages about the Russian Winter), Ukrainian officials are protesting, saying that violating an earlier agreement, made with the previous Moscow-friendly president, Victor Yanukovych, to sell the gas at a lower price. As the AP reports:
But Ukrainian officials have protested the proposed price of $385 per 1,000 cubic meters, and [ Minister of Energy and Coal Industry of Ukraine Yuri] Prodan has said he would stick by his stance that Ukraine should pay only $268."
While the two sides plan to meet to Berlin this week, Russia reiterated its position on Tuesday:
#Russia energy minister Novak: Ukraine must pay $1.9 billion for new gas + $2 billion in debt before gas supplies can resume, says Interfax— Neil MacFarquhar (@NeilMacFarquhar) September 30, 2014
Heightening the stakes, last week, Hungary announced (under pressure from Russia) that it was suspending all gas supplies to Ukraine due to an increase in demand. As the BBC noted, Hungary, along with Poland and Slovakia, had been supplying Ukraine with gas since a dispute over payment let to Russia cutting off Ukraine's gas in June.
Ukraine does have one hand to play in that Russia's pipelines cross Ukrainian territory to get to Europe, its largest customer. Last month, Russia warned that if Ukraine gets desperate enough, it could siphon off gas that's meant to get to Europe.
With the Ukrainian economy in shambles, swaths of eastern Ukraine lost, and a weeks-long truce holding in name only, Ukrainians have already started preparing for a very cold winter.