Ukraine, Russia set to hold 2nd day of gas talks

Ukraine and Russia are set to hold a second day of talks over gas prices in an attempt to prevent a possible disruption of gas deliveries to Europe.

The EU-mediated talks are to be held on Sunday in the Ukrainian capital, Kiev, a day ahead of a Moscow deadline to cut off energy supplies unless Kiev pays part of its USD 5.2 billion gas debt. Russia’s state-owned energy giant Gazprom has given Kiev until 06:00 GMT tomorrow to pay USD 1.95 billion or it will face a gas cut-off.

The two sides held the first day of talks, mediated by European Energy Commissioner Guenther Oettinger, on Saturday.

According to Ukraine’s Energy Minister Yuri Prodan, each side explained its position; however, no solution was found during the meeting.

Meanwhile, Ukraine’s Prime Minister Arseniy Yatsenyuk has told regional administrators and the head of the state energy company, Naftogaz, to start implementing a plan for reduced energy consumption.

The previous round of the EU-mediated talks, which were held on June 11 in the Belgian capital of Brussels, failed after Ukraine refused Russian President Vladimir Putin’s offer of the “final price” of USD 385 per 1,000 cubic meters.

Kiev has refused to pay for natural gas upfront as a protest to Russia’s decision in April to almost double former gas prices. Gazprom raised the price of gas for Ukrainian consumers to USD 485 per 1,000 cubic meters from USD 268 for the first quarter of 2014.

Ukraine says Kremlin increased the price after former Ukrainian president, Viktor Yanukovych, was ousted in February. Kiev calls the move politically motivated, but Russian authorities reject the claim.

Russia provides about half of Ukraine’s and 30 percent of Europe’s total gas demand through major pipelines in the Ukrainian territory.