Ukraine agrees to pay gas debt to Russia

BERLIN -- Ukraine agreed to start in this week paying a gas debt it owed Russia, in a bid to resolve a gas supply dispute between the two countries, said European Union Energy Commissioner Guenther Oettinger in Berlin on Monday.

Ukraine agreed to pay $2 billion back to Russia by Thursday for the gas delivered since July last year, said Oettinger in a press conference started nearly one and half hours later than scheduled, following a meeting with Ukraine Energy Minister Yuri Prodan and his Russian counterpart Alexander Novak.

Another $500 million would be paid by June 7, Oettinger said, adding that the deal was subject to the approval of governments of both sides, after consulting political leaders and companies until Wednesday evening.

The three officials have met twice for solutions to dispute over gas imports from Russia to Ukraine.

According to Russia, Ukraine has not paid for the gas it imported in full for months, accumulating a debt of over $3.5 billion.

Oettinger said further talks would be held on Friday in Berlin, focusing on prices for gas delivered since April, when Russia cut discounts for gas sold to Ukraine for twice, pushing up the price from $268.5 per 1000 cubic meters to $485.

Ukraine refused to accept the price, accusing Russia to increase the price for political reasons, while Russian side insisted that it would discuss a new gas discount only if Ukraine started to pay the debt.

Prodan told reporters that a final deal was not yet reached with Russia, and a "just market price" was needed.

The gas dispute concerned EU, since it imports one third of its gas from Russia and half of them are transported via Ukraine.

In the Monday press conference, Novak urged Ukraine to pay off the debt and said that Russia were "prepared to fulfill the contract" with its exports customers including those in Europe.