By RIA Novosti
Moscow : Ukraine’s president will meet with his Russian counterpart in Moscow on Tuesday to try to resolve the latest natural gas debt row between the countries, and deter a supply cutoff.
Viktor Yushchenko’s meeting with Vladimir Putin follows the failure of Ukrainian national energy company Naftogaz and Gazprom to reach agreement on Monday on the ex-Soviet state’s gas debt that the Russian monopoly puts at $1.5 billion.
Gazprom has delayed by eight hours its deadline for Ukraine to pay the debt, to 6:00 p.m. Moscow time (3:00 p.m. GMT). The company insists the debt must be paid off before changes to the current supply schemes can be discussed.
Gazprom spokesman Sergei Kupriyanov said the cutoff would only apply to the Russian gas supplied on the border with Ukraine, which makes up 25% of the total. The other three quarters is pumped from Central Asia.
Ukraine seeks to remove intermediary firms in gas deals with Russia, with Prime Minister Yulia Tymoshenko, the main driving force behind the initiative, blaming trader RosUkrenErgo for the debt.
The price for gas Russia supplies to Ukraine is also likely to be reviewed. Ukraine, which transits 80% of Russian gas supplied to Europe, also seeks to raise its transit fees.
A pricing row between the former Soviet allies led to a brief cutoff of supplies to Ukraine in early 2006, when Europe-bound exports were also affected. The European Union buys a quarter of its natural gas from Russia.
Earlier reports said Putin and Yushchenko would also discuss Ukraine’s World Trade Organization membership and its bid to join NATO.
Earlier this month, Yushchenko signed an agreement with the global trade body clearing the way for Kiev’s membership. Moscow fears this could complicate bilateral gas and trade talks as Kiev could block Russia’s WTO bid.
Russian presidential aide Sergei Prikhodko said ahead of Yushchenko’s visit that Ukraine’s joining the WTO would be bad news in the short term, but “not entirely bad news” in the longer term.
In Moscow, Yushchenko will also attend a session of a bilateral trade commission and sign a series of agreements, according to the Kremlin press office.
Ukraine is a key trade partner of Russia. Bilateral trade rose by over 20% last year to $32 billion dollars.
The two presidents’ last meeting took place in Kiev in December 2006.
Ukraine has been plagued by a series of political crises in recent years. Its new government was formed late last year following early parliamentary polls in September and ensuing protracted power-sharing disputes.
Opposition parties to the pro-Western ‘orange’ forces have been blocking the legislature for about a month in protest against the government’s announced bid to join NATO.