(Moscow/ Kiev) Russia shut down all gas flows to Europe through Ukraine and told Kiev it would restore supplies only after it had agreed to pay full market prices.

The Kremlin quoted Russian president Dmitry Medvedev as telling Ukrainian leader Viktor Yushchenko in an evening telephone call that gas supplies had become hostage to squabbling within the Ukrainian leadership.
The apparent tone of the conversation reflected the broader political tensions between Ukraine and its former Soviet master in Moscow. Yushchenko’s efforts to join Nato are bitterly opposed by Moscow and viewed with wariness even by European members of the alliance and by investors.
The European Union (EU) also gave Ukraine its clearest warning yet that any failure to meet commitments to deliver Russian gas to the bloc would hurt its aspirations for closer EU ties.
“If Ukraine wants to be closer to the EU, it should not create any problems for gas to come to the EU,” European Commission president Jose Manuel Barroso told a news conference in Prague, where he was meeting Czech officials who hold the rotating presidency of the 27-nation EU.
The row over gas prices and debts owed by Ukraine to Russia cut heating to tens of thousands of households in Bulgaria and hit supplies as far west as France and Germany as Europe faced freezing mid-winter temperatures. “The price should be a market price based on a pricing formula,” the Kremlin quoted Medvedev as telling Yushchenko.
“There will be no discounts or preferences for Ukraine.” Ukraine, an ex-Soviet state with a large Russian-speaking population, had long been paying prices below world levels for gas.
Russia’s move to raise prices and its August invasion of a breakaway region of ex-Soviet Georgia have both been a source of conflict between Yushchenko and his prime minister, Yulia Tymoshenko. (oilandgasnewsworldwide.com)

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