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Navigation Primary Navigation Home Singapore Asia Pacific World Business Entertainment Sports Technology Top Stories Most Popular Secondary Navigation Search Search: Russia, Ukraine agree to resume Europe gas supplies AFP - 2 hours 9 minutes ago MOSCOW (AFP) - - Russia and Ukraine announced a gas agreement on Sunday that they said would "shortly" allow a resumption of supplies to Europe, but questions remained on how and when the deal would be implemented. "We have reached an agreement," Russian Prime Minister Vladimir Putin said in televised comments after marathon, late-night negotiations with his Ukrainian counterpart Yulia Tymoshenko in Moscow. "Shortly the gas transit -- as the Ukrainian side assures us -- will be resumed," he said, speaking alongside Tymoshenko. Tymoshenko said Russian and Ukrainian state gas firms had been told to draw up agreements by Monday and "immediately after those documents on transit and gas prices are signed, all transit of gas to Europe will be resumed. "The talks were not easy but we have reached a mutual understanding that allows us to sign agreements," she added. Russian energy giant Gazprom and its Ukrainian counterpart Naftogaz were "preparing contracts for signature," Gazprom spokesman Sergei Kupriyanov later told Interfax news agency. Millions of Europeans have experienced reductions or complete cut-offs of heating in the middle of winter as a result of the crisis. The European Union has piled pressure on Russia and Ukraine, calling for an immediate resumption of gas supplies. Under the terms of Sunday's deal, Ukraine agreed to shift to full European prices for Russian gas in 2010 after years of enjoying prices significantly lower than those paid by Russia's European customers. "Starting from January 1, 2010, Ukraine and Russia will shift to European prices on gas and gas transit," Putin said. But in 2009 Ukraine would get a 20-percent discount relative to the European price, as long as it kept the tariffs it charges for the transit of Russian gas to Europe at the 2008 level, he said. Even with the discount, in the short term Ukraine will pay much more for gas than it did last year. In 2008 Ukraine paid 179.5 dollars per 1,000 cubic metres of gas from Russia while the average price in Europe was over 400 dollars. Gas prices in Europe are now around 450 dollars per 1,000 cubic metres. The crisis started earlier this month after Ukraine rejected a Russian offer to pay 250 dollars for 2009. In the longer term however the price of gas is expected to fall since it is indexed to the price of oil with a time lag, and oil prices have plunged in recent months due to the global economic slowdown. Putin's spokesman Dmitry Peskov told AFP he could not say what the exact 2009 price for Kiev would be. It was not clear whether the two sides had settled their dispute over Kiev's unpaid debts to Moscow from 2008. It was also unclear whether Tymoshenko's deal with Putin would be supported by her political arch-rival at home -- President Viktor Yushchenko, who has taken a harder line with Russia than she has. Before heading for Moscow, Tymoshenko said she was confident of reaching a deal but, in an apparent reference to Yushchenko, said she hoped to avoid getting "a knife in the back" for her efforts. Sunday's deal capped nearly a month of high-stakes brinkmanship, closed-door intrigue and furious invective between the two ex-Soviet neighbours that left EU countries baffled by their behaviour. The crisis began on January 1 when Russia cut the gas to Ukraine's domestic market over a payment dispute, then escalated when Moscow halted all supplies for European customers transiting via Ukraine, accusing Kiev of stealing gas. Ukraine vehemently denied this and accused Russia of stoking the crisis. Swathes of central Europe and the Balkans have been left shivering by the crisis, with gas-fired central heating reduced or cut off to millions of people and schools and factories shut down because of the lack of supplies. Email Story IM Story Printable View Blog This Recommend this article Average (0 votes) Sign in to recommend this article » Most Recommended Stories » Most Popular – Top Stories Viewed Zimbabwe unveils $100 trillion banknote 'Dogs don't wear condoms,' says Baywatch star Anderson Israel prepares for ceasefire vote amid Hamas warning Boy George jailed for 15 months for imprisoning escort Hormone drives sexy women to infidelity, says study View Complete List » Search: Home Singapore Asia Pacific World Business Entertainment Sports Technology Top Stories Most Popular

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