Ukraine, Russia, EU agree to natural gas supply deal

Ukraine, Russia, EU agree to natural gas supply deal (Source Reuters) Ukraine, Russia and the European Union signed a deal on Thursday that will see Moscow resume vital supplies of gas to its ex-Soviet neighbor over the winter in return for payments funded in part by Kiev’s Western creditors. After several failed rounds of talks in recent weeks as conflict rumbles on despite a ceasefire with pro-Russian rebels in eastern Ukraine, the accord also eases concerns that a new “gas war” could disrupt winter supplies if energy to EU states, notably through pipelines shut down across Ukraine since June. With overnight temperatures already nudging below freezing in Ukraine, European Commission President Jose Manuel Barroso hailed an accord clinched in Brussels barely 24 hours before he and the rest of his team make way for a new EU executive. “There is now no reason for people in Europe to stay cold this winter,” he told a news conference after witnessing the signing of documents by the Russian and Ukrainian energy ministers and EU energy commissioner Guenther Oettinger. Worth $4.6 billion in total, the package calls for Ukraine to pay $3.1 billion in two tranches by the end of the year to cover debts for previous supplies from Russia’s Gazprom , and Kiev will have $1.5 billion, some from existing accords with the EU and IMF, to pay for about 4 billion cubic meters of new gas until March, for which Russia is insisting on cash up front.

 

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