Ukraine-Gazprom crisis averted, for now

gas_pipeline.jpg

Ukraine has agreed to settle a debt of $2 billion owed to Gazprom, calming EU fears about a possible repeat of the January 2006 gas supply crisis caused by a payment dispute between the Ukraine and the Russian energy giant.

In addition to a cash payment of nearly $930 million, Ukraine has also agreed to hand over $1.2 billion in natural gas deposits to Gazprom as part of a debt clearance deal announced by Russian Prime Minister Vikto Zubkov on 8 October.

The agreement follows earlier assurances by Ukraine’s energy ministry that the crisis would be resolved swiftly (EURACTIV 05/10/07), a move widely interpreted as an effort to remove barriers to the election of Yulia Tymoshenko as prime minister during upcoming elections (EURACTIV 01/10/07). There was speculation that Russia was using the Gazprom debt issue as a way to put political pressure on Ukraine to block the ascendancy of Tymoshenko, who represents pro-Western forces in Ukraine (EURACTIV 03/10/07).

Following the announcement, EU Energy Commissioner Andris Piebalgs assured reporters during a speech in Vienna that the issue is “definitely settled”. 

But Piebalgs also warned that the EU “should be watching very carefully how developments are in December, January”, when prices for natural gas contracts between the Ukraine and Russia will have to be renegotiated, setting the stage for possible further disputes.

Meanwhile, Gazprom is interested in taking part in the privatisation of Serbia’s state-owned oil company NIS in exchange for a controlling share in the firm, according to Russian state television. Gazprom has also expressed interest in running the planned South Stream pipeline through Serbian territory.

If realised, the deals would give the Russian state-backed energy giant control over key strategic energy assets and gas pipeline infrastructures in the Western Balkans, according to press reports.

Meanwhile, Ukraine, Poland, Lithuania, Azerbaijan and Georgia yesterday signed a deal to build a pipeline that will bring oil sourced in the Caspian region to Poland and thus reduce central and eastern Europe’s dependence on Russian oil. 

The agreement will see the Odessa-Brody pipeline through Ukraine extended as far as Plock, Poland, giving onward access to Gdansk and Lithuania.

Subscribe to our newsletters

Subscribe