Official: Ukraine locks itself into syphoning Russian gas off

GORNO-ALTAYSK, Republic of Altai, May 29 (PRIME) -- Kiev will have to pilfer Russian gas pumped to Europe through Ukraine as it has chosen not to pay for the supplies, Deputy Economic Development Minister Andrei Klepach said Thursday.

“This is critical for Ukraine. Kiev cannot forgo Russian gas purchases. This is an issue of blackmailing. Ukraine does not want to pay for Russian gas and will pilfer it,” Klepach said.

Ukrainian President-elect Pyotr Poroshenko said that Ukraine will no longer buy gas from Russia because Gazprom has set too high a price for it.

Russia and Ukraine are fighting over gas prices, with Kiev wanting to change a 2009 contract under which it is to buy a set volume of gas, whether it needs it or not, at Europe’s highest price of U.S. $485 per 1,000 cubic meters.

Moscow dropped the price to $268.50 after Ukraine's then-President Viktor Yanukovich turned his back on a trade and association agreement with the European Union last year, but reinstated the original price after he was ousted in February.

Gazprom says Ukraine owes it over $3.5 billion, and has threatened to stop supplying the neighboring former Soviet republic with gas if it fails to make a pre-payment for June supplies.

Klepach said that Ukraine has taken more gas than the contract stipulates and has not paid for it since the start of the year.

“There will be a conflict, as there has already been. Of course, a compromise will be found, but technically Ukraine cannot help but take our gas. It cannot replace it,” he said.

He said that Ukraine keeps about 10 billion cubic meters of gas in storages, while reverse supplies from Europe, which Ukraine has recently started, cannot replace Russian supplies neither by volumes, nor by the price.

“Ukraine has some gas in its storages but it is meant to ensure the stability of supplies to Europe. This is why they can steal 9 billion cubic meters of gas or even more, it will tide them over for a while.”

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