Russia and Ukraine warned on gas crisis

THE EUROPEAN Union threatened yesterday to push for legal action against Russia and Ukraine if they fail to end a gas crisis …

THE EUROPEAN Union threatened yesterday to push for legal action against Russia and Ukraine if they fail to end a gas crisis that has sent a chill through homes and paralysed industry across the Balkans.

The warning came as Moscow urged Brussels to take a tougher line with Kiev, which it claims is blocking Russian gas flow to the EU, and Ukraine again accused Kremlin-controlled energy firm Gazprom of prolonging the crisis by sending gas down only the most technically troublesome of its pipelines.

“If the agreement sponsored by the EU is not honoured, the [European] Commission will advise EU companies to take this matter to the courts,” said commission president José Manuel Barroso, referring to a deal to restart gas exports once monitors were in place to ensure they flowed freely. The monitors are at key gas facilities in Russia and Ukraine, but fuel is still not reaching the EU.

“The current situation is in short most unacceptable and incredible,” added Mr Barroso. “If the agreement is not honoured, it means Russia and Ukraine can no longer be regarded as reliable.”

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Russian president Dmitry Medvedev proposed holding a gas summit in Moscow on Saturday involving all EU gas importers and Ukraine.

A rumbling row over Kiev’s alleged gas debts to Gazprom intensified when Russia stopped pumping gas to its neighbour on New Year’s Day.

After claiming that EU-bound gas was being siphoned from pipelines in Ukraine, Moscow then halted all gas flow across the country on January 7th.

The EU relies on Russia for one-quarter of its gas, and 80 per cent of that arrives in the bloc via Ukraine. The shut-off has seen several Balkans countries suffer severe heating shortages, and has forced industry across eastern Europe to switch to other fuels and dramatically reduce production.

The prime ministers of three of the worst-hit countries, Bulgaria, Slovakia and Moldova, visited Moscow yesterday for talks.

Russia proposed that Ukraine pump gas to Slovakia from its reserves, and Gazprom would pump the same amount to Ukraine to compensate.

A similar plan was being discussed with Moldova, but would be technically impossible for Bulgaria, officials said.

There was no immediate response from Kiev.

“The biggest risk for both Russia and Ukraine is the issue of trust,” said Bulgarian premier Sergei Stanishev. “The dispute has been running for a few years but it should not turn third countries into hostages.”