Page last updated at 15:51 GMT, Thursday, 18 December 2008

Gazprom threatens Ukraine supply

By James Rodgers
BBC News, Moscow

Newly-opened gas plant in Ukraine
Russia says Ukraine owes it $1.2m

Russian gas company Gazprom says it may cut supplies to Ukraine on 1 January if a continuing dispute over pricing has not been resolved.

Gazprom say it has received only $800m (522m) of the $2bn it says Ukraine will owe by the end of the year.

Rows between Gazprom and Ukraine rattle Europe's nerves as a supply cut could affect the amount of Russian gas reaching countries further west.

That is what happened during a similar dispute in 2006.

Now Gazprom says that unless agreement is reached over outstanding payments, and a new delivery contract signed, it will have no legal obligation to supply Ukraine from 1 January.

That, of course, raises the prospect of a cut - although Gazprom may stop short of actually taking such a step.

While Gazprom insists it acted legally in shutting off gas to Ukraine three years ago, suggestions from Europe that it was acting irresponsibly threatened to damage Russia's international reputation as an energy supplier.

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