Putin: Russia May Cut Gas Supplies To Ukraine

MOSCOW, Russia -- Prime Minister Vladimir Putin warned Ukraine on Thursday that Russia will reduce gas supplies to Ukraine if it tries to siphon Russian gas intended for European consumers.

Russia's Prime Minister Vladimir Putin answers questions during his annual question-and-answer session with the Russian people in Moscow, December 4, 2008.

The tough warning, which comes amid difficult talks on a price for Russian gas supplies to Ukraine, will likely stoke fears in European nations that saw a drop in Russian gas shipments when Moscow cut gas to Ukraine in January 2006, amid a similar pricing dispute.

"We are proceeding from the assumption that we won't have any problems with transit of gas to Western Europe," Putin said during a question-and-answer session televised nationwide. "But if our partners don't fulfill the agreements or try to siphon gas from the transit pipelines as they did in past years, we will be forced to reduce supplies. What else can we do?"

Russia accused Ukraine of diverting transit gas during a 2006 supply cutoff. In another supply dispute in March, Ukrainian officials held out the possibility of siphoning off Europe-bound gas if necessary.

Putin's words contrasted with previous statements from both Russian and Ukrainian officials who said that they hope the gas dispute won't lead to a disruption of supplies to Ukraine or European consumers, as was the case in 2006. Most of the gas Russia supplies to Europe goes through Ukraine.

Putin said that state gas monopoly Gazprom has to raise the price Ukraine pays of $179.50 per 1,000 cubic meters, which is half of the price Gazprom charges its customers in Europe.

Putin didn't say how much Russia wants to charge, but Gazprom officials have suggested that the price for Ukraine could top $400 next year.

Gazprom also has demanded that Ukraine quickly pay off its debt for previous supplies, and talks on the issue are ongoing.

Source: AP