Russia warns EU of Ukraine gas shortage Published duration 29 August 2014

image copyright AFP image caption A Ukrainian gas installation - there are worries about winter deliveries

Russia says there is a risk that gas shortages this winter could force Ukraine to siphon off supplies of Russian gas meant for EU customers.

Ukraine's gas reserves have reached a "critical" state, Russian Energy Minister Alexander Novak said.

He was speaking after talks in Moscow with EU Energy Commissioner Guenther Oettinger. The EU is anxious to ensure secure gas supplies for the winter.

Ukraine needs to store much more gas underground, Mr Novak said.

He estimated at 10bn cubic metres (353bn cu ft) the amount of extra gas that Ukraine would need to pump into underground storage tanks to avoid having to siphon off gas from the transit pipelines.

In winter, he warned, "there will be big risks, above all the possibility of Ukraine taking gas to meet its own needs, instead of those supplies going to European customers".

Gas dispute

In June Russia halted gas deliveries to Ukraine because of a price dispute, but large volumes still transit Ukraine to reach EU countries.

Russia has accused Ukrainian authorities in the past of diverting transit gas from pipelines in order to supply Ukrainian customers.

Ukraine and many other European countries depend on deliveries of Russian gas, provided by the state monopoly Gazprom.

Gas security is a priority for the EU as Ukraine battles to win back eastern areas held by pro-Russian separatist fighters.

The EU's wide-ranging sanctions against Russia affect oil industry projects but not the vital gas sector.

Ukraine is in dispute with Russia about the price charged by Gazprom. The dispute has gone to the International Council for Commercial Arbitration (ICCA) in Stockholm.

Ukraine's debt to Gazprom has risen to $5.3bn (£3.2bn) and must be paid, Mr Novak said.

Mr Oettinger said he agreed with Mr Novak that an interim gas price must be found, long before the ICCA issues a ruling next summer.

He stressed that Russia must fulfil all of its contractual supply and transit obligations.

The EU, Russia and Ukraine must also agree on a repayment plan for the unpaid bills in the coming weeks, Mr Oettinger said.