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Oct 30, 2014 5:21 AM

Ukraine-Russia gas talks deadlocked in Brussels

The Associated Press

BRUSSELS (AP) Talks to guarantee that Russian gas imports flow into Ukraine throughout the winter appeared to be at an impasse Thursday because of doubts over payments from Kiev.

A European Union official says the negotiations, which were supposed to produce an agreement Wednesday, broke up inconclusively early Thursday, with a draft for a 'common understanding' sent to Moscow and Kiev for consideration. The official asked not to be named because an agreement had yet to be reached.

The EU-brokered talks were to continue later Thursday.

Ukrainian Prime Minister Arseniy Yatsenyuk said the amount his government would pay for Russian gas would fall in line with global oil prices, which have tumbled in recent weeks.

Yatsenyuk said at a Cabinet meeting in Kiev that Ukraine could pay $365 per 1,000 cubic meters from the start of next year, down from the $385 rate agreed earlier this month. He said that figure may be adjusted downward to $378 until the end of the year.

Russian President Vladimir Putin and his Ukrainian counterpart, Petro Poroshenko, agreed earlier this month on the broad outline of a deal, but financial issues, centering on payment guarantees for Moscow, have since bogged down talks.

But with each week, the need for a resolution becomes more pressing, since winter is fast approaching in Ukraine, where temperatures often sink below freezing for days.

Russia cut off gas supplies to Ukraine in June after disputes over Russia's annexation of Crimea in March. Ukraine since then has been relying on gas transfers from other European countries and its own reserves.

EU Commission President Jose Manuel Barroso conferred "a number of times" Wednesday with Poroshenko in Kiev, stressing that "an agreement was within reach," a Commission statement said.

The EU has said previously that Ukraine would settle its energy debt to Russia with a $1.45 billion payment by the end of the month and $1.65 billion more by the end of the year. It has said for new gas deliveries, Ukraine would pay $385 per 1,000 cubic meters, which Russia should deliver following advance payments by Ukraine.


Associated Press writer Peter Leonard in Kiev, Ukraine, contributed to this report. Raf Casert can be followed on Twitter at http://www.twitter.com/rcasert


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