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Russia may make additional decisions on gas price for Ukraine in 3 months — Putin

March 31, 2015, 19:04 UTC+3

During a meeting with Prime Minister Dmitry Medvedev Putin said that the issue of gas price is linked with oil prices and the situation on the global market is quite volatile

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Vladimir Putin

Vladimir Putin

© Alexey Druzhinin/Russian presidential press service/TASS

NOVO-OGAREVO, March 31. /TASS/. Russian President Vladimir Putin supported the government’s proposal on Tuesday to extend a gas price discount for Ukraine to the second quarter.

Prime Minister Dmitry Medvedev said at a meeting with President Putin that the government deemed it necessary to grant the corresponding request from Ukraine and Gazprom for a gas price discount on condition that Kiev complied with all the terms of Russian natural gas supplies, "including the repayment of those debts that have accumulated."

"Let’s do this," Putin said.

The premier said the government had received Gazprom’s proposal on extending the gas price discount for Ukraine for the next quarter until July 1.

"We proceed from the fact that the Ukrainian economy is currently in quite a difficult position and even though such a decision implies not quite favorable consequences for our budget as well — I mean the cancellation of a part of an export duty — we consider it possible to support the request by Gazprom and the corresponding request by the Ukrainian side," Medvedev said, explaining the rationale of the government’s decision.

The Russian president said he didn’t rule out that additional decisions could be made on the gas price for Ukraine in three months.

The gas price is based on the oil price formula while world oil markets are currently very volatile, the Russian president said.

"Considering this, we need to see in three months what is going on in this sphere and make additional decisions," Putin said.

Gazprom CEO Alexey Miller earlier said the Russian gas giant had turned to the government with a request to extend the gas price discount for Ukraine for another three months.

The option of a gas price discount is stipulated in the existing gas contract between Gazprom and Ukraine’s national energy company Naftogaz.

Russia granted Ukraine a discount of 100 per 1,000 cubic meters in October 2014 for a term of five months. The discount expires on April 1.

Russian Energy Minister Alexander Novak said earlier "the price of gas for Ukraine will total $348 per 1,000 cubic meters from April 1." He added that the Russian government would consider the issue of a gas price discount for Kiev for the second quarter before April 1, if it received the Ukrainian side’s corresponding request.

Based on the current gas price of Russian natural gas supplies to Ukraine, the discount may amount to $100 per 1,000 cubic meters.

Therefore, the gas price for Ukraine will equal about $250 per 1,000 cubic meters in April.

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