Gas War Escalates As Russia Demands Ukraine Pay Gazprom Up Front

  • Date: 09/05/14
  • Nigel Wilson, international Business Times

Russia has demanded Ukraine pay for gas in advance from June, according to the country’s energy minister, after Kiev failed to pay for gas deliveries in April.

Russian energy giant Gazprom said on Wednesday that Ukraine now owed the company a total of $3.51bn, after failing to pay for April’s gas supply.

“According to contract… failure of obligations automatically leads to a switch to prepayment for gas deliveries for Ukraine starting from 1 June,” Russian Energy Minister Alexander Novak said in a statement late Thursday.

Russia had already threatened to cut supplies to Ukraine if Kiev does not pay up front for gas before the end of May.

The European Union relies on Russia for around a third of its gas needs, while 40% of that is delivered via pipelines through Ukraine…

In previous disputes over energy prices, Russia has twice cut supplies to Ukraine in January 2006 and 2009. Those cuts affected supplies to some European countries, although the crises were resolved within a matter of days on both occasions.

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