Russian gas export monopoly Gazprom said on Friday, Dec. 26, that its dispute with Ukraine over payments could cause disruptions in deliveries to western Europe, a news agency reported.
A debt dispute between Russia and Ukraine could affect gas deliveries to Europe
Gazprom spokesman Sergei Kupriyanov said that Gazprom head Alexei Miller had notified Europe's largest clients that it could not rule out the possibility of a cut off, according to Itar-Tass.
"Gazprom is doing everything possible to avoid any disruption of gas deliveries to Europe," said Miller in the letter cited by the news agency.
"However, if events develop along an unfavorable scenario, the problem of Ukrainian transit will be a common problem for Russia and Europe," Miller said.
At issue is the lack of progress in reaching agreement with Ukraine's Naftogaz over $2 billion in non-payments for imports by Kiev, with a New Year's deadline looming with threatened cut-offs by Gazprom.
Gazprom supplies about one-quarter of the European Union's gas needs, 80 percent of which is shipped through Ukraine.
Gazprom says it's trying to resolve the dispute with Ukraine, but can't guarantee European deliveries
"We consider that it's our duty to warn (Europe) that we cannot be sure that transit obligations will be respected, seeing that Naftogaz is systematically slowing its contractual obligations," Miller said in his letter.
In its letter, Gazprom said it doubted it could uphold its obligations to deliver gas to western Europe without resolution of the disagreements with Naftogaz. But Gazprom pledged to do all it could to resolve the dispute.
In a similar dispute in 2006, Russia blamed Kiev for siphoning off gas to European customers - sparking fuel shortages and a price spike as far as Paris.
Gazprom claims Ukraine has paid only $800 million in arrears of its total debt, and analysts say the country's crushing economic problems make reimbursing of more of the debt difficult.
Gazprom takes care of 80 percent of the EU's gas needs
Russian President Dmitry Medvedev told Ukraine on Wednesday to pay its gas debts "to the last ruble" or face the prospect of sanctions from Moscow against its wider economy.
Medvedev did not say what sanctions Russia could use against Ukraine's flagging economy but menacingly warned it had a "whole arsenal of possibilities" at its disposal.
Ukraine has begged a $16.4-billion loan from the International Monetary Fund, but conditions applied to the money means it cannot directly be used pay its overdue gas bill.