Russia, Ukraine Leaders Tackle Gas Row

MOSCOW, Russia -- Russia's ruling tandem of Vladimir Putin and Dmitry Medvedev held rare joint talks Saturday with the visiting leader of Ukraine over the two sides' festering energy row.

Dmitry Medvedev (L), Viktor Yanukovich (C) and Vladimir Putin (R).

The meeting with Ukrainian President Viktor Yanukovych at the Russian government's Zavidovo hunting estate came just hours after Medvedev had dramatically asked Putin to take over the presidency from him in March polls.

The three men were shown strolling together in a park in their black autumn jackets and looking down from a scenic pond bridge before returning to the lodge for more talks.

"We have already managed to resolve lots of problems, and I am sure that we will take the right and constructive approach here as well," Yanukovych told Medvedev in televised opening remarks.

"I accepted your invitation and came here to be at your side on this symbolic day for Russia and for Ukraine as well, I am sure," the Ukrainian leader added in reference to the planned handover of power to Putin.

The political drama in Moscow overshadowed a visit whose importance escalated sharply with Ukraine's announcement last month that it was ready to take its neighbour to an international court over gas.

Ukraine currently serves as Europe's main link to Russia's natural gas supplies and a previous dispute over prices led to a cut-off that lasted three weeks in January 2009.

Russia has been gradually raising the price it charges the former Soviet republics for gas after spending more than a decade subsidising deliveries in exchange for friendlier relations.

Ukraine says it should be paying a price closer to $230 per 1,000 cubic metres than the approximately $400 it will be charged at the turn of the year.

The Kommersant business daily said Ukraine was preparing to lift the price it charges for Russia's gas transits to EU nations if no agreement is reached -- a move certain to anger Moscow.

Kiev has also vowed to take Moscow to an arbitration court in Brussels and refused to join a Russian-led customs union that Medvedev has set out as one of the conditions for a lower gas price.

Moscow is also willing to negotiate a lower price if Ukraine gives up control of its natural gas transmission to Russia's Gazprom monopoly.

Ukraine has rejected the offer and has been ready to make a counter-proposal that would see Russia and the EU take joint stakes in the pipeline network -- a condition rejected by Russia.

Yanukovych called the gas dispute "worrying" in his comments to Medvedev.

Source: AFP