Russia just cut off Ukraine’s natural gas supplies

posted at 6:41 pm on June 17, 2014 by Erika Johnsen

Even amid the escalating tension, officials from Russia, Ukraine, and the European Union were all huddled together as of Sunday evening still trying to work out some kind of last-minute deal to dissuade Russia from cutting off Ukraine’s gas supplies for the third time since 2006 — but nothing doing. As Keith Johnson at Foreign Policy reported:

Monday morning, Gazprom, the big Russian gas firm, said it halted gas flows to Ukraine and that it won’t ship any more until Kiev pays its hefty arrears and then prepays thereafter.

Gazprom said that Ukraine was guilty of “persistent nonpayment,” and said Kiev owes it about $4.5 billion. Russian officials said they would only be willing to go back to negotiations if Ukraine settles its outstanding debt. Russian Prime Minister Dmitry Medvedev blamed Ukraine for the crisis after it rejected “very beneficial, very preferential proposals” from Gazprom.

Ukrainian leaders sounded a defiant note after the shut-off, saying the energy fight was part of a broader offensive by Moscow against the beleaguered country.

“This is not about gas. This is part of the general plan of Russia to destroy Ukraine,” said Arseniy Yatseniuk, Ukraine’s prime minister, according to the Financial Times. “Ukrainians will not pull $5 billion out of their pockets a year so that Russia can use this money to buy arms, tanks and planes and bomb Ukrainian territory.”

Ukraine can live off of its stored gas supplies for now, particularly as the northern hemisphere enters the summer months, but if this keeps up through next winter, Ukraine could be in big trouble. In the meantime, Russian gas shipments to Europe — which make up thirty percent of Europe’s total gas supplies, half of which are shipped via pipeline through Ukraine — are supposed to continue uninterrupted, but again, if push comes to shove, there may come a point when Ukraine starts siphoning off some of those pipeline shipments for its own use.

During a cutoff in Ukraine’s gas supply in 2009, exports to Europe also took a hit, with Gazprom saying that Ukraine had siphoned off deliveries destined for the EU. It then decided to halt all supplies through Ukraine.

This time, Ukrainian officials said they had adequate inventories and other supply sources to meet domestic needs at least until the end of the year.

“The Ukrainian side has prepared for this eventuality and we are ensuring reliable transit as well as supplies to domestic consumers,” Yuri Prodan, Ukraine’s energy minister, said, according to the Interfax news agency.

The EU urged Kiev not to deplete its natural-gas storage facilities, worried that both Ukraine and Europe could otherwise face shortages. The 28-country bloc relies on Gazprom for over a third of its gas imports, with some countries 100% dependent on Russian gas.

Still, Russia has a lot to lose by barging intransigently ahead, too; even if Russia can follow through with its threat to bring alternate non-Ukrainian pipeline routes online, this is an excellent reminder for European Union members of how unreliable a partner Russia is and will only reinforce their current push to look for more diversified energy sources to cut down on their Russian energy dependency — an eventual fate of which Russia is not at all a fan. Even with the new energy deal Russia just inked with China, Europe is still a major energy market that Russia and its energy-export-reliant economy cannot afford to lose.


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Pfffft

faraway on June 17, 2014 at 6:44 PM

Energy futures are going to soar.

Buy all energy futures – now.

FYI – I never give people advice – but this one is easy. MONEY !!!!!

jake-the-goose on June 17, 2014 at 6:44 PM

This winter Ukrainians can gather around the iPod and warm themselves with the rhetorical wizardry of Barack Obama.

Cicero43 on June 17, 2014 at 6:44 PM

Ukranians can hope they are are rescued as quickly as the Americans in Iraq. Err, or the Americans in Benghazi. Oh nevermind.

faraway on June 17, 2014 at 6:46 PM

Energy independence is so overrated.

Hill60 on June 17, 2014 at 6:47 PM

Ukraine is screwed.

Stoic Patriot on June 17, 2014 at 6:47 PM

Putin: “It was just a hard drive crash. Nothing to worry about”

faraway on June 17, 2014 at 6:47 PM

Deploy the hastag army! Ready the sit ins. Release the unwashed students.

This winter Ukrainians can gather around the iPod and warm themselves with the rhetorical wizardry of Barack Obama.

Cicero43 on June 17, 2014 at 6:44 PM

Just too funny.

Oil Can on June 17, 2014 at 6:48 PM

Where there is a will there is a way. I am sure they will maneuver their way around Russia and find the gas the need.

coolrepublica on June 17, 2014 at 6:49 PM

Ukraine is screwed.

Stoic Patriot on June 17, 2014 at 6:47 PM

Ukraine is hammered and sickled.

(OT, but is anyone else get a blank page when clicking on the Headlines comment numbers?)

JetBoy on June 17, 2014 at 6:50 PM

The Ukrainians know how to live without gas, food, or necessities. They were under soviet rule for many decades.

portlandon on June 17, 2014 at 6:50 PM

In the meantime, Russian gas shipments to Europe — which make up thirty percent of Europe’s total gas supplies, half of which are shipped via pipeline through Ukraine — are supposed to continue uninterrupted,

I thought that pipeline just went kaboom?

WryTrvllr on June 17, 2014 at 6:50 PM

I guess when they shut down the gulch, they messed up the headlines?

davidk on June 17, 2014 at 6:51 PM

Where there is a will there is a way. I am sure they will maneuver their way around Russia and find the gas the need.

coolrepublica on June 17, 2014 at 6:49 PM

Which cabinet member of the Obama Administration are you?

portlandon on June 17, 2014 at 6:52 PM

Putin messin with Biden’s son ?
He’s so gonna regret that
:O

http://www.usatoday.com/story/theoval/2014/05/13/biden-joe-hunter-ukraine-gas-company-burisma-holdings/9047751/

burrata on June 17, 2014 at 6:52 PM

sorry. just a fire. no explosion

WryTrvllr on June 17, 2014 at 6:52 PM

The Ukrainians know how to live without gas, food, or necessities. They were under soviet rule for many decades.

portlandon on June 17, 2014 at 6:50 PM

Excellent point. Just like old times.

slickwillie2001 on June 17, 2014 at 6:55 PM

http://www.breakingnews.com/topic/ukraine-protests-over-eu-agreement-delay/

Kyiv, Kyiv City Municipality, UA
1d

Ukraine says Russia has cut off all gas supplies to Kiev, in a major escalation of a dispute between the nations – @BBCNews
Read more on http://www.bbc.com

Russia
1d
Gazprom CEO says Ukraine believed Russia did not have right to raise gas prices ‘The last word about the price is with Russian government’ – @CNBCWorld

Russia
1d
Gazprom files lawsuit in the Stockholm Arbitration Court to recover $4.5 billion from Naftogaz of Ukraine – @GazpromNewsEN

Russia
1d
Russian stock indexes drop 1.6%-1.7% at open following Ukraine gas dispute deadline passing – Interfax

Russia
1d
Gazprom confirms it has switched Naftogaz of Ukraine to a gas prepayment scheme following debt deadline – @GazpromNewsEN

Russia
1d
Ukraine must pay up front for gas as deadline for debt payment passes, Russia’s Gazprom says after it didn’t receive payment for June – @Reuters

European Union
1d
Russian gas giant Gazprom reaffirms 6:00 GMT deadline for Ukraine debt payment after EU-brokered talks fail – @BBCBreaking
Read more on bbc.co.uk

Russia
2d
No deal reached at gas talks with Ukraine, says spokesman for Russian gas producer Gazprom – @Reuters

Kyiv, Kyiv City Municipality, UA
2d
Ukraine and Russia end gas pricing talks in Kiev without a deal, source close to the talks says – @Reuters

Russia
2d
Ukraine and Russia make last-ditch attempt to reach a deal in a gas pricing dispute, hours before deadline for Kiev to pay a $1.95 billion debt or have its gas supplies cut off – @Reuters
End of alert
============

canopfor on June 17, 2014 at 6:56 PM

Spoke too soon; headlines operational.

davidk on June 17, 2014 at 6:56 PM

Reports of a suspicious person wearing a vest or backpack with wires coming out prompted the lockdown of the Los Angeles Air Force Base in El Segundo on Tuesday.

The person was wearing a vest or backpack with wires displayed, Capt. Ryan Evanski with the El Segundo Police Department said.

The individual had ammunition magazines but no firearm, Evanski said just after 3 p.m.

http://ktla.com/2014/06/17/l-a-air-force-base-in-el-segundo-on-lockdown-due-to-report-of-suspicious-person/

davidk on June 17, 2014 at 6:58 PM

Which cabinet member of the Obama Administration are you?

portlandon on June 17, 2014 at 6:52 PM

Department of Proverbs. But before that I worked at the ministry of common sense.

coolrepublica on June 17, 2014 at 6:58 PM

Wasn’t it Chad which just discovered massive deposits of natural gas, or was it the Seychelles…or Honduras? There was some country that had this massive amount of natgas but their government said no to developing it because it might harm a fanged beetle. Where was that?

Bishop on June 17, 2014 at 7:01 PM

US Dept of Interior @Interior · Jun 16

.@SecretaryJewell announces 102 Million to help Atlantic Coast communities protect themselves from future storms http://on.doi.gov/1ox8Xjl

davidk on June 17, 2014 at 7:02 PM

BREAKING: Witnesses: Explosion blasts World Cup viewing center in northeast Nigeria, many feared dead.

— The Associated Press (@AP) June 17, 2014

Hey, Hillary, do you still believe that Boko Haram isn’t a terrorist organisation?

Resist We Much on June 17, 2014 at 7:02 PM

We are that close to disaster as far our energy supplies..

We, and Europe, are so close to having a situation develop that dramatically cuts our energy supplies. Well, who cares about Europe, but we have to do everything we can to build our own energy independence, because anything less makes us seriously vulnerable to problems in the middle east or whatever that could bring major hurt to us, as an interruption in our energy supplies would likely tank our economy and wreak havoc with our way of life.

Don’t sabotage our coal power plants right now. That’s insane. Don’t continue to block the XL Pipeline. That’s insane. Don’t continue to block oil development on federal and Alaskan lands. That’s insane.

And quit with the bs about “climate change.” We’ve had 18 years of no warming despite the rise of CO2, and, historically, with ice core data going back hundreds of thousands of years, we see that there is no actual evidence that CO2 causes temperature change (this is contrary to the baloney Al Gore spouted in his movie): https://www.youtube.com/watch?v=WK_WyvfcJyg&info=GGWarmingSwindle_CO2Lag

anotherJoe on June 17, 2014 at 7:05 PM

JetBoy on June 17, 2014 at 6:50 PM

Affirmative .. For a couple of hours, actually.

pambi on June 17, 2014 at 7:05 PM

People are reporting two explosions.

davidk on June 17, 2014 at 7:07 PM

Barry is going to have to schedule another 18 holes of golf!

trs on June 17, 2014 at 7:07 PM

Open-air viewing centres – where people pay to watch live football – are popular throughout Nigeria.

However, the Nigerian authorities have warned residents in some states to avoid public screenings of the World Cup, fearing militant attacks.

On Thursday, the north-eastern state of Adamawa ordered all venues planning to show live coverage of the football tournament to close, saying they had received intelligence of planned bomb attacks.

The states of Borno, Yobe and Adamawa have been under a state of emergency since May 2013. At least 2,000 people have died in the north-east since Boko Haram launched an insurgency in 2009.

Analysts say Islamist militant groups, including Boko Haram, have described football as un-Islamic.

http://www.bbc.com/news/world-africa-27896257

davidk on June 17, 2014 at 7:08 PM

Hey, Hillary, do you still believe that Boko Haram isn’t a terrorist organisation?

Resist We Much on June 17, 2014 at 7:02 PM

Killery : Aaaimm a poh blak womun , aaaii ha a vayjayjay

burrata on June 17, 2014 at 7:09 PM

Communist thinks he is tough. He has little man syndrome

weedisgood on June 17, 2014 at 7:11 PM

BREAKING: Witnesses: Explosion blasts World Cup viewing center in northeast Nigeria, many feared dead.

— The Associated Press (@AP) June 17, 2014

Hey, Hillary, do you still believe that Boko Haram isn’t a terrorist organisation?

Resist We Much on June 17, 2014 at 7:02 PM

RWM: Just fired that off to TIPS:)

canopfor on June 17, 2014 at 7:12 PM

Attack in northeastern Nigeria, June 17, 2014
1m
Several people feared dead after explosion hits World Cup viewing center in northeast Nigeria, witnesses say – @AP
Read more on bigstory.ap.org
============================

https://twitter.com/AP

http://www.breakingnews.com/

canopfor on June 17, 2014 at 7:13 PM

I wish we had leadership here with the balls to say you have a problem with the US…out goes the light..or money.

celt on June 17, 2014 at 7:16 PM

An explosion has rocked a venue in the town of Damaturu in northeast Nigeria where fans had gathered to watch a World Cup soccer match.

The blast at the Crossfire venue, in the Nayi-Nawa area of the state capital of Yobe, happened at about 8.15pm local time, just as tournament hosts Brazil kicked off against Mexico, according to the police commissioner for Yobe.

Sanusi Ruf’ai said: “There was an explosion outside a soccer viewing centre here in Damaturu at around 8.15pm.

“Our men have deployed to the scene but it’s too early for us to give details.”

One resident said the area had been cordoned off as police and soldiers were sent to the scene.

The blast comes after at least two states banned viewing centres on security grounds following previous attacks blamed on Boko Haram militants, whose five-year insurgency in northern Nigeria has claimed thousands of lives.

http://www.rte.ie/sport/soccer/worldcup/2014/0617/624574-explosion-hits-world-cup-screening-in-nigeria/

davidk on June 17, 2014 at 7:16 PM

I’m beginning to think that their thug-in-chief is better than our thug-in-chief.

trigon on June 17, 2014 at 7:18 PM

I’m no Putin fan but at least as a leader he has the balls to do what he assumes is n his country’s best interest…unlike our leadership here.

celt on June 17, 2014 at 7:19 PM

Witnesses say a suicide bomber in tricycle taxi triggered an explosion that blasted a World Cup viewing center in northeast Nigeria, killing several people.

Hospital workers say the death toll likely will rise with 15 people critically wounded and casualties still coming in at Damaturu, state capital of Yobe state.

Boko Haram Islamic extremists have targeted football viewing centers and sports bars in recent weeks, killing at least 40 people in two blasts in northern cities.

Witnesses said the tricycle taxi was driven into the outdoor area soon after the Brazil-Mexico match started Wednesday night. All spoke on condition of anonymity for fear of reprisals.

Nigeria’s military has promised increased security but appears incapable of halting a stream of attacks by extremists holding more than 250 schoolgirls hostage.

http://news.yahoo.com/explosion-rocks-world-cup-viewing-venue-nigeria-230758054.html

davidk on June 17, 2014 at 7:24 PM

Department of Proverbs. But before that I worked at the ministry of common sense. Doing Stupid Shiite

coolrepublica on June 17, 2014 at 6:58 PM

RickB on June 17, 2014 at 7:24 PM

Communist thinks he is tough. He has little man syndrome

weedisgood on June 17, 2014 at 7:11 PM

He’s tougher than our Slug-in-Chief

RickB on June 17, 2014 at 7:26 PM

World cup explosion video: http://www.youtube.com/watch?v=_PP6mVIvelk

davidk on June 17, 2014 at 7:27 PM

World Cup fans didn’t get all the fireworks today.

Ukraine suspects pipeline blast was an attack-Worldnews.com

Ukraine suspects gas pipeline blast was an attack. Ukraine said on Tuesday it was treating an explosion on a pipeline carrying Russian natural gas to the rest of Europe as a possible “act of terrorism”.

Toocon on June 17, 2014 at 7:52 PM

Energy futures are going to soar.

Buy all energy futures – now.

FYI – I never give people advice – but this one is easy. MONEY !!!!!

jake-the-goose on June 17, 2014 at 6:44 PM

When the economy crashes because people are paying $4-$5 bucks a gallon to get work to the food stamp office they wont be worth that much. Seeing as the economy contracted last month…

V7_Sport on June 17, 2014 at 7:57 PM

Suddenly, the Choom Gang will forget the War on Coal and declare the War on Fracking.

formwiz on June 17, 2014 at 8:29 PM

For now the Ukrainian’s should increase the fees the Russians need to pay to ship gas to Europe THROUGH THEIR COUNTRY.

What goes around, comes around.

GarandFan on June 17, 2014 at 8:44 PM

Man, obama kicked putin’s ass.

What a whuppin’.

Putin’s talk was cheap, obama’s sanctions were expensive.

everdiso on June 13, 2014 at 1:11 PM

mankai on June 17, 2014 at 9:57 PM

You know what I like about Putin?

He plays for his team. Obama not so much.

jukin3 on June 17, 2014 at 10:20 PM

Last time there was something similar, EU applied pressure to Ukraine to resume talks and negotiate with Russia. These dreams about EU learning about Russia is a pipe dream.

Just entertain this thought for a second. It’s June 18, 2014, and some European politician has just “learned” something about Putin’s Russia. What would be your diagnosis for this person?

PBH on June 18, 2014 at 6:06 AM