Industryweek 6734 Moscow Kiev Gas Deal

'Good Chance' of Moscow-Kiev Gas Deal: EU Energy Chief

May 26, 2014
European Energy Commissioner Guenther Oettinger says Russia and Ukraine have a good chance of striking a deal to resolve a standoff over Russian gas deliveries to Ukraine by June 1.

BERLIN -- Russia and Ukraine have a "good chance" of striking a deal to resolve a standoff over Russian gas deliveries to Ukraine by June 1, European Energy Commissioner Guenther Oettinger said Monday.

"We made relatively good progress and have a good chance of reaching an agreement by June 1," said Oettinger after a Berlin meeting with Russian Energy Minister Alexander Novak and his Ukrainian counterpart, Yuri Prodan.

Under a proposed deal, subject to approval in Kiev and Moscow, Ukraine would pay $2.5 billion to Russian energy giant Gazprom (IW 1000/16) in coming days and weeks -- about half the amount Russia says it is owned in back payments and for the month of June.

Oettinger said the goal was to ensure "security of supply" and "to avoid disruptions," adding that aid from the EU and International Monetary Fund would help Ukraine pay its debt, provided both Moscow and Kiev agree to the deal.

"We make it possible, but the decision will be made in Kiev," said the German EU commissioner.

German Chancellor Angela Merkel warned earlier Monday that "it is important that the energy talks make progress ... I hope an agreement can be reached this week. That is very important."

Russia had hiked its gas price for Ukraine for April and May to $485 per 1,000 cubic meters, one of the highest among European countries. On average, EU countries pay between $350 and $400 per 1,000 cubic meters.

Novak said Ukraine's debt had reached "astronomical" levels but added that "our side is prepared, when we receive payment, to continue negotiations on the price for future supplies."

Copyright Agence France-Presse, 2014

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