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Gazprom threat hangs over Ukrainian elections

Published 03 October 2007
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Russian energy giant Gazprom has threatened to cut gas supplies to Ukraine, just two days after the pro-Western parties claimed victory in parliamentary elections in Ukraine, sparking memories of the gas row that followed the 'Orange Revolution'.

The Russian energy monopoly, which has close links with the Kremlin, announced on 2 October that it would cut gas supplies to Ukraine unless it settled a $1.3 billion (€918 million) bill, which it said remains unpaid to date.

The new dispute raises fears that European gas supplies may also be affected. Some 80% of Gazprom's Europe-bound exports pass through pipelines in Ukraine and Russia that provide about a quarter of all European gas.

"Gazprom has today notified its European partners of the existing problems in gas supplies to Ukraine. If the debt is not settled in October, Gazprom will be forced to begin to cut natural gas supplies to Ukrainian consumers," the energy giant stated on 2 October.

Analysts assume that there is a political motivation to the move, as pro-Western parties claimed victory at the Ukrainian parliamentary elections held on 30 September. 

The results were warmly welcomed by the EU, which supported the 'Orange Revolution' in 2004. Gazprom, however, denied that the timing was related to the election results, arguing that the move was "not connected in any way with who wins or does not win in Ukraine".

"We will do all it takes to cooperate with Russia in order to have no gas cuts," Yulia Tymoshenko told reporters in Kiev on 2 October. Tymoshenko has a good chance of becoming Ukraine's next prime minister after her party finished in the lead in Sunday's elections (see EurActiv 01/10/07).

"The Commission urges a speedy settlement of this issue," the EU executive said in a statement on 2 October. "Today the European Commission was informed by Gazprom about a problem of payments for gas delivered to Ukraine and the possibility of reducing gas deliveries to Ukraine if no satisfactory solution was found."

The new threat is reminiscent of the 2005 gas row, when Gazprom decided to impose higher market prices (see EurActiv 15/12/05), ending a long-running agreement to provide preferential rates to the former Soviet state.

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