Russia sharply cuts natural gas to Europe

January 07, 2009|By Megan K. Stack and Sebastian Rotella | Megan K. Stack and Sebastian Rotella,Los Angeles Times

MOSCOW -

Russia's natural gas monopoly drastically cut flows to Europe through Ukraine yesterday, sharpening fears of winter fuel shortages.

Despite warnings from the European Union, a pricing dispute between Gazprom and Ukraine showed no signs of letting up. As the two sides traded accusations and blame, negotiations remained frozen for the sixth day.

Bulgarian authorities said two-thirds of their natural gas supply had been cut off and consumption would be reduced to ensure provisions for public facilities. In a dozen other countries, governments said they could compensate with reserves or alternate sources.

Haggling over the price Ukraine would pay for Russian gas and how much Moscow would pay Ukraine for allowing gas to cross the territory in pipelines, collapsed Dec. 31.

Moscow halted all gas flows to Ukraine, then began to scale back on European exports via Ukraine, accusing the smaller neighbor of stealing gas intended for Europe. The EU gets about a fourth of its natural gas from Russia.

Gazprom Vice President Alexander Medvedev called Russia a victim of Ukrainian misdeeds. Ukraine officials deny diverting any gas, insisting they are tapping reserves to keep the country running. The head of Ukraine's state energy company was expected in Moscow tomorrow for further talks.

The European Commission in Brussels, Belgium, and the Czech government, which holds the rotating presidency of the European Union, called the situation "unacceptable."

Bulgaria, Hungary, Slovakia, Romania and Poland had suffered the most, the office of the European commissioner for energy said.

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