July 30, 2014
Ukraine, Russia hold last-ditch gas talks
Ukraine and Russia made a last-ditch attempt to reach a deal in a gas pricing dispute, hours before a deadline for Kiev to pay a $1.95 billion debt or have its gas supplies cut off.
A spokeswoman for the Ukrainian energy ministry said talks had resumed in Kiev but gave no details.
Russia and Ukraine disagree how much Kiev should pay for the natural gas it receives from Russia and Russian state-owned natural gas producer Gazprom plans to switch to an advance payment system if Kiev does not start paying its bills.
The deadline is 0600 GMT tomorrow, after which Russia has threatened to halt supplies to Ukraine.
This could in turn disrupt the gas flow to the European Union, which gets some of its imports via Ukraine, but prospects for a breakthrough have been hit by political tensions and clashes between Ukrainian government forces and pro-Russian separatists.
The talks, which are being mediated by the European Commission, had been expected to resume this morning following a failure to secure a breakthrough at a meeting on Saturday, but began hours later. The reason for the delay was not immediately clear.
Ukraine has accepted a European Commission compromise proposal of $326 per 1,000 cubic metres of gas for an interim period. Moscow has offered Kiev a $100 reduction to $385, around the average amount paid by Russia's European clients.
Resolving the dispute and averting supply cuts could help ease tension over the separatist rising in east Ukraine, which Kiev blames on Moscow despite Russian denials that it is arming the rebellion.
Tensions are also high following Russia's annexation of Crimea after Ukraine's Moscow-leaning president was ousted and pro-Western leaders took over power.