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'Positive momentum' in Ukraine, as Steinmeier heads for Russia

Overnight gas payment talks have ended without a deal between Russia and Ukraine, yet a new diplomatic optimism is evident. Amid several signs of slight improvement, Germany's foreign minister jets to St Petersburg.

Marathon talks on Ukraine's payment for Russian gas deliveries ended without agreement in the early hours of Tuesday morning in Brussels, and are to be continued either on Tuesday or Wedensday.

"All points of the deal were negotiated, and discussions will resume," EU Energy Commissioner Günther Oettinger, acting as mediator, said after seven hours of talks. State-owned Russian energy giant Gazprom is seeking payment from Ukraine's Naftogaz - both of unpaid past bills and supplies through June. When Gazprom first threatened the cutoff, it said Ukraine owed a total of $5.2 billion (3.79 billion euros),

some of which has since been repaid

. The nominal deadline for a deal was Monday, June 9, but Oettinger's announcement that the talks would continue seemed to imply some flexibility.

Ukraine formerly enjoyed a discounted rate for Russian gas exports, but Gazprom increased the price by 81 percent, to the above-average $485.50 per 1,000 cubic meters, after the change of government in Kyiv that ousted former President Viktor Yanukovych.

The gas dispute also put supplies to the rest of Europe in question. Roughly one-third of European natural gas hails from Russia, with Ukraine a crucial transit country.

'Faint light at end of tunnel'

Despite the ongoing difficulties in the gas talks, diplomatic developments surrounding Ukraine have taken on a more positive note in recent days. German Foreign Minister Frank-Walter Steinmeier struck an upbeat tone in Berlin on Monday night, as he prepared to travel to St Petersburg for talks with his Russian counterpart Sergei Lavrov and Poland's foreign minister, Radoslaw Sikorski.

"In the Ukraine conflict, for the first time in months, a faint light is now visible at the end of the tunnel," Steinmeier said.

"We're still not close enough to a solution of the Ukraine crisis," Steinmeier said, but added it was positive that

the two sides were now talking directly

. Ukraine's President Petro Poroshenko,

sworn in on Saturday

, and Russia's Vladimir Putin

held brief talks on the sidelines of Friday's D-Day anniversary celebrations

. This small step was hailed as a minor diplomatic breakthrough.

Steinmeier said he would use his time in St Petersburg, a major power base for Putin, to explore "how the positive momentum of the last few days can be used to make the process of de-escalation irreversible." The German Foreign Ministry similarly highlighted its hopes for the St Petersburg visit on both its German- and English-language Twitter accounts.

Poroshenko hints at ceasefire

Poroshenko on Monday suggested that a ceasefire was possible in the disputed regions of Donetsk and Luhansk, which Kyiv's military is seeking to reclaim from the control of pro-Russian separatists.

"We should cease fire in the course of this week," the president's office quoted Poroshenko as saying on Monday. "Each day when people die, when Ukraine pays such a high price, is inadmissible for me."

Later on Monday, Kyiv's Foreign Ministry said in a statement that it had reached a "mutual understanding" with Moscow on parts of a plan proposed by Poroshenko to end the violence in Ukraine's east.

"As a result of the work, the sides reached a mutual understanding on key stages of the implementation of the plan and on a list of priorities which will contribute to a de-escalation of the situation in the Donetsk and Luhansk regions of Ukraine," the statement said, offering no concrete details. Russia did not immediately comment.

The closed-door talks are being mediated by the Organization for Security and Cooperation in Europe - the identities of Russian and Ukrainian participants are not known.

msh/crh (AFP, dpa, Reuters)

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