Saturday, September 27, 2014

Ukraine Back-Tracking On E.U. Brokered Gas Deal With Russia

The EU, which depends on Russian gas piped through Ukraine for about 15 percent of its demand, has been trying to broker a deal to maintain shipments since May. Photographer: Vincent Mundy/Bloomberg

Ukraine Backs Off From EU-Backed Russia Gas Deal -- Express Tribune/AFP

KIEV: War-torn Ukraine on Saturday distanced itself from an EU-brokered agreement with Russia that would have restored its gas supplies during winter and helped rebuild trust between the neighbouring foes.

The European Union’s energy commissioner emerged from hours of acrimonious negotiations in Berlin on Friday to pronounce the three month dispute on the verge of being resolved.

“We have developed a workable design for a winter package,” Guenther Oettinger said.

Both he and Russia’s energy minister added that a final agreement could be signed after consultations in Moscow and Kiev next week.

A compromise would not only save the westward leaning nation from adopting drastic energy savings measures in freezing weather but also make sure that Russian gas flowed uninterrupted to European homes.

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Previous Post:
Russia - Ukraine - E.U. Gas Deal Reached

My Comment: I should have seen this coming. The Ukraine government is miffed because it is going to be the EU/IMF paying Russia directly for the gas that will be sent to Ukraine/Europe this winter .... not Ukraine receiving the money and then paying Russia. This European and IMF reluctance to give money to Kiev is understandable .... the money that was loaned to Kiev a few months ago for paying off debt (and Russian gas) was not used for that expressed purpose (it was used for purchasing weapons and paying salaries). I still expect an agreement to occur, but this is Ukraine's way of pressuring the EU for more money and support .... which I predict that they will get.

Update: Kudos to Zero Hedge for predicting this two days ago .... Ukraine PM Cries "Russia Wants Us To Freeze" As Locals Prepare For A Long, Cold Winter (Zero Hedge).

1 comment:

James said...

You're right, Ukraine can't steal any of it when it's direct payment.