Russia’s Gazprom announced that it would grant Naftogaz, the cash-crunched Ukrainian state energy company, a few extra days in January to pay its December natural gas import bill.
(Staff & wire reports) – Russia’s Gazprom announced on Dec. 22 that it would grant Naftogaz, the cash-crunched Ukrainian state energy company, a few extra days in January to pay its December natural gas import bill.
“Taking into account the holidays, an agreement was reached to postpone the payment date for December supplies from Jan. 7 to Jan. 11,” Gazprom said in a statement. Most Christians in both countries celebrate Christmas on Jan. 7.
The announcement came as Gazprom chief executive officer Alexei Miller met for talks with Naftogaz head Oleh Dubyna. Naftogaz has struggled to cover monthly import bills amid a deep economic recession which has hit consumption and timely payments by consumers.
With a 15 percent drop in gross domestic product, the nation has paid $400 million to $700 million in monthly payments thanks largely to $11 billion in aid provided by the International Monetary Fund. But a lack of political consensus in the run-up to the Jan. 17 presidential election has frozen further IMF assistance, raising fears that the nation could find it particularly difficult to pay gas import bills in coming months.
The European Union, which saw Russian gas supplies shut off for weeks during last January’s Kyiv-Moscow energy war, has been watching closely and urges both sides to avert repeat disruption. In recent months, Russian and Ukrainian officials have moved to reassure Brussels that a repeat standoff was unlikely.
But the political temperature in Ukraine is high ahead of the presidential election. Moreover, the cost of Russian imports for Ukraine’s government is set to increase sharply – to $305 per 1,000 cubic meters – during the first quarter of 2010, compared to a 2009 average of $208 per 1,000 cubic meters.
