Medvedev Says Russia Could Switch to Gas Prepayment for Ukraine

MOSCOW, April 9 (RIA Novosti) – Russian Prime Minister Dmitry Medvedev said Wednesday Russia could switch to a prepayment scheme for gas deliveries to Ukraine following the failure of the country to pay for imported gas.

“If this critical situation actually continues, I think there is reason to switch to an advance payment system for delivering gas,” Medvedev said, referring to persistent delays in Kiev’s payment for energy supplies.

Yuri Prodan, Ukraine’s minister on the energy and coal industry, admitted earlier that the regime in Kiev had failed to pay for March deliveries of Russian natural gas, pending an agreement on price. Kiev is ready to pay, he said, adding that Gazprom’s bill was too high after the Russian energy giant scrapped discounts earlier provided to the country.

In the first quarter, Ukraine was to pay $268.50 per 1,000 cubic meters for Russia’s gas deliveries under a December agreement with Moscow. Russia cancelled the discount starting on April 1, bringing the gas price up to $385.50, because Kiev defaulted on its debt, not having enough cash to pay for ongoing deliveries in violation of the agreement.

Gazprom raised the price to $485.50 on April 3 after it revoked an earlier discount dating to 2010, which was granted to Kiev in return for an extension on the lease of the Black Sea Fleet base in Crimea, now Russian territory.

Ukraine has since been wooing Gazprom to return to December prices of $268.5 per 1,000 cubic meters.

Leave a comment