Thursday, April 10, 2014

Putin warns Europe of gas shortages over Ukraine debts

Could Russia turn off the taps? The BBC's Daniel Sandford reports
Russian President Vladimir Putin has warned European leaders that Ukraine's delays in paying for Russian gas have created a "critical situation".
Pipelines transiting Ukraine deliver Russian gas to several EU countries and there are fears that the current tensions could trigger gas shortages.
Pro-Russian separatists are holed up in official buildings in Donetsk and Luhansk, eastern Ukraine.
Meanwhile, a European human rights body has stripped Russia of voting rights.
The Parliamentary Assembly of the Council of Europe (PACE) monitors human rights in 47 member states, including Russia and Ukraine.
Protesting against Russia's annexation of Crimea last month, PACE suspended Russia's voting rights as well as Russian participation in election observer missions.
The Russian delegation had boycotted the meeting. Its leader, Alexei Pushkov, described the proceedings as a "farce".

Pro-Russian protesters in Donetsk. 10 April 2014Activists inside the Donetsk government building have proclaimed a "Donetsk Republic"
Russian state gas giant Gazprom says Ukraine's debt for supplies of Russian gas has risen above $2bn (£1.2bn; 1.4bn euros).
Gazprom said on Wednesday it could demand advance payments from Kiev for gas but President Putin said the company should hold off, pending talks with "our partners" - widely believed to mean the EU.
In a letter to European leaders, President Putin warned that the "critical" situation could affect deliveries of gas to Europe, his spokesman Dmitry Peskov said.
The letter released by the Kremlin says that if Ukraine does not settle its energy bill, Gazprom will be "compelled" to switch over to advance payment, and if those payments are not made, it "will completely or partially cease gas deliveries".
Mr Putin adds that Russia was "prepared to participate in the effort to stabilise and restore Ukraine's economy" but only on "equal terms" with the EU.
And he says that while Russia has been subsidising the Ukrainian economy with cheap gas, Europe has been exploiting its raw materials and worsening its trade deficit.
The US state department later said it condemned "Russia's efforts to use energy as a tool of coercion against Ukraine".
Spokeswoman Jen Psaki said the price Ukraine was being charged for its gas was "well above the average price paid by EU members".
Nearly a third of the EU's natural gas comes from Russia.
Previous Russian gas disputes with Ukraine have led to severe gas shortages in several EU countries. The EU says it has extra gas supplies and reverse-flow technology to deal with any such disruption now.

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