Russia and Ukraine face off over gas again

MOSCOW/KIEV (Reuters) – Russia said on Thursday Ukraine must repay a $2.4 billion gas debt, but Kiev denies the claim, raising fears the two sides face another battle in their gas war, which has threatened European supplies in the past.

Russia has often threatened to cut gas supplies during pricing disputes with Ukraine and has fulfilled the threat in early 2006, briefly halting supplies to Europe, 80 percent of which go via Ukraininan territory.

Russian president Dmitry Medvedev has ordered gas export monopoly Gazprom (GAZP.MM: Quote, Profile, Research, Stock Buzz) to ask Ukraine to pay back its gas debt to Russia, which Gazprom estimated at $2.4 billion.

“We need to fully clarify ourselves with Ukraine’s debt and recover it on a goodwill or compulsory basis. As it is stated in the current legislation and within the frames of our bilateral relationships,” Vesti 24 TV channel showed Medvedev as saying to Gazprom’s chief executive Alexei Miller at a meeting in the Kremlin.

But Ukraine’s state energy firm Naftogaz said its debt to RosUkrEnergo, a Russian-Ukraine intermediary gas trader, co-owned by Gazprom, is nearly half of what Gazprom estimates.

Reuters