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Russia gas supplies via Ukraine halted

Published: 9:19AM Tuesday January 06, 2009 Source: Reuters

Supplies of Russian gas via Ukraine to Bulgaria, Greece and Turkey stopped flowing because of a dispute between Moscow and Kiev over gas prices, officials in Sofia said.

Russia on Monday ordered a reduction in gas flow to Europe via Ukraine, a measure it said was to stop its neighbour stealing fuel and which Ukraine said would jeopardise supplies to Europe as it faces freezing temperatures.

 The gas row has raised new questions about Russia's reliability as an energy supplier and rekindled Western suspicions - still fresh after Russia's war with Georgia last year -- that the Kremlin bullies its pro-Western neighbours. 

Knock-on effect

Russian gas export monopoly Gazprom cut all supplies for Ukraine's domestic use on New Year's day in a row over gas prices - creating a knock-on effect for Europe which receives one fifth of its gas from pipelines through Ukraine.

"As of 3.30 am (2:30pm NZT) supplies ... to Bulgaria as well as the transit to Turkey, Greece and Macedonia have been suspended," Bulgaria's Economy Ministry said in a statement. "We are in a crisis situation."

There was no immediate confirmation from Turkey, Greece or Macedonia of a halt in supplies. Turkey has an alternative route for importing Russian gas, under the Black Sea.

South-east Europe and the Balkans receive their Russian gas from a pipeline which passes from Ukraine via Bulgaria, so officials in Sofia are likely to be the first to see signs of a cut-off.

In Kiev, Ukrainian state energy Naftogaz firm said Russia had cut gas supply via Ukraine to Europe to about a third of its normal flow. "This means that in a few hours Europe will face a problem with gas supplies," said a Naftogaz spokesman.
 
Gazprom said it had not choice but to reduce supplies to Europe via Ukraine because Kiev was siphoning off gas intended for transit. It said it would boost supplies through other routes to compensate.
 
A delegation from the European Union was to meet Ukrainian officials in Kiev on Tuesday, and fact-finding talks were also planned for Tuesday between EU officials and Gazprom, though the venue had not yet been confirmed.

European Commission President Jose Manuel Barroso said on Monday he had appealed to Putin and Ukrainian Prime Minister Yulia Tymoshenko not to let their dispute affect Europe's gas supplies.

"I hope that the matter will be resolved, as the reality is that if it is not then it may create problems for European countries who are not responsible for the situation," he said.

Russia has clashed repeatedly with Ukraine's pro-Western leaders over their ambition to join the NATO alliance. Gazprom denies any political motive in the row and says it is purely about Kiev's refusal to pay a fair price for its gas.

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