Russia-Ukraine deal guarantees gas supplies through the winter

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Moscow and Kiev have clinched a deal that will guarantee that Russian gas exports flows into Ukraine throughout the winter despite their intense rivalry over the fighting in eastern Ukraine.

In the signing ceremony in Brussels following protracted negotiations, the two sides promised to get the gas flowing into Ukraine again after a long and bitter dispute over payments.

EU Commission president Jose Manuel Barroso, whose offices mediated the talks for months, said the EU will also help cash-strapped Ukraine with the payments through aid and guarantees.

“There is now no reason for people in Europe to stay cold this winter,” he said. He added that he was “hopeful that the agreement can contribute to increase trust between Russia and Ukraine”.

EU energy chief Guenther Oettinger said “we can guarantee a security of supply over the winter,” not only for Ukraine but also for the EU nations closest to the region that stood to suffer should the gas stand-off have worsened.

A similar stand-off in 2009 had caused serious disruptions in gas flowing from Russia into the EU and it was a prospect the bloc sought to avoid.

The agreement long hinged on the question of whether Ukraine was in a position to come up with the necessary cash to pay for the gas.

A confident Mr Oettinger said Kiev was, and that the £2.9bn deal should extend through March.

“We can claim and pay for amounts that we need. That question has been totally settled,” said Yuriy Prodan, Ukrainian minister for energy. “There will be no problems.”

Under the deal, Ukraine would pay for its outstanding debt by making a £900,000 deposit without delay, and £1.03bn by the end of the year.

The final sum of debt would 
be determined through arbitration.

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