Ukraine threatens to retaliate if Russia hikes gas prices in 2009

Ukraine warned Friday it will raise its fees on Russian gas shipments through its territory and on underground storage services if Russia abruptly hikes gas prices in 2009.

‘Be confident that Ukraine will have a strong asymmetric response if there is a question of imposing European price levels and if there is a willingness to introduce them immediately, starting from January 1, 2009,’ Olexander Chaly, a deputy assistant in the Ukrainian president’s office, told a press conference.
He said such ‘market conditions would also apply to all other components of the gas trade, notably transit and storage.’

Russia on June 6 said it would double the present tariff that Ukraine pays for gas from next year as a result of the higher costs of acquiring the gas from Central Asia.

Although Russia holds massive gas reserves of its own beneath its vast Siberian expanses, it also imports large amounts of gas from Central Asian neighbours, due to a lack of investment in developing its own reserves.

In March, Central Asia’s main producers, Kazakhstan, Turkmenistan and Uzbekistan, said that they would charge Russia ‘European’ prices — almost double current levels — starting from 2009.

Forbes