Ukraine defaults on its Gazprom gas debt

8 April 2014 Last updated at 00:32

Ukraine misses Gazprom’s deadline to pay gas debt

Ukraine has not paid off any of its debt to Gazprom despite a deadline for the nation to start reducing its debt by midnight (Moscow time) on Monday.

A Gazprom spokesperson told Reuters: “There have been zero payments from Ukraine.”

Ukraine owes Gazprom $2.2bn (£1.3bn) for supplies of natural gas.

Gazprom did not say what action it would take if Ukraine failed to pay. The nation has missed previous deadlines without punishment.

However, in recent years disputes over the price of gas have seen Gazprom cut off supplies to Ukraine.

That happened during the winters of 2005 and 2008.

‘Economic aggression’
With the severe deterioration in relations between Russia and Ukraine, the issue of Ukraine’s gas supply is again a big political issue.

Over the weekend, Ukraine rejected moves by Russia to almost double the price of Russian gas supplies to the country and threatened legal action.

Ukraine’s interim PM, Arseniy Yatsenyuk, said Moscow’s hikes were a form of “economic aggression”.

His energy minister said Ukraine would try to negotiate a gas deal, but warned that if talks failed Ukrainians should prepare for Russia to cut off supplies.

Moscow says the price change is due to Kiev’s failure to pay its bills.

Russia’s state-controlled company Gazprom has raised the cost of gas to Ukraine by 81% to $485.50 (£292.86, 354.33 euros) from $268.50 for 1,000 cubic metres.

Ukraine is holding emergency talks with western nations to find alternative supplies of gas.

Leave a Reply