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Last Updated: Thursday, 28 December 2006, 16:28 GMT
EU urges end to Belarus gas row
Russian President Vladimir Putin (left) and Belarusian president Alexander Lukashenko
Relations between Russia and Belarus have become fractious
The EU has urged Russia and Belarus to end their gas price dispute, amid concerns that consumers across Europe could be affected.

Russia's state-owned Gazprom has vowed to cut off gas to Belarus on 1 January unless a 134% price rise is accepted.

Russian gas passes through Belarus via pipeline on its way to other parts of Europe, and a shutdown could put supplies at risk.

The EU's Andris Piebalgs said Brussels was following the situation closely.

"I call on the two parties to reach as soon as possible a satisfactory agreement that does not put in question gas transits to the EU," said Mr Piebalgs, the EU's energy commissioner.

Belarus currently pays $47 per 1,000 cubic metres for the gas it imports from Gazprom, Russia's state-owned gas monopoly.

Gazprom wants to increase this to $110. It also wants Belarus to hand over a 50% share of the country's distribution network, including a valuable transit pipeline which supplies gas to Poland and Germany.

Gazprom chief executive Alexei Miller has said that unless Belarus agrees, the firm will end gas supplies from 0700 GMT on New Year's Day.

'Strong-arm' tactics

Russia says its neighbours have been paying below-market rates and these now need to be brought into line with European prices.

A clash between Ukraine and Russia over pricing last winter was blamed for a surge in UK consumer gas bills.

Ukraine: $130 for 1,000 cubic metres (was $95)
Georgia: $235 ($110)
Moldova: $170 ($160)
Belarus: Gazprom wants $110 ($47)
Azerbaijan: Gazprom wants $235 ($110)

Last week, Georgia agreed to pay $235 for 1,000 cubic metres of gas, more than twice the previous price of $110.

Moscow has also renegotiated its gas contract with Bulgaria, which will see the latter pay up to 45% more for its gas imports over the next five years.

Critics argue Moscow is using strong-arm tactics to consolidate its economic supremacy in the region, at a time when high demand for energy and fears of supply shortages have strengthened its position as Europe's leading gas supplier.

The dispute has strained relations between Russia and Belarus, which are traditional allies.

Last week, Russian president Vladimir Putin and his Belarusian counterpart, Alexander Lukashenko, met in an effort to resolve the issue, but made little progress.

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