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Yatsenyuk: Russia’s decision to abolish zero export duty on gas "unacceptable"

April 03, 2014, 22:06 UTC+3 KIEV
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KIEV, April 03, /ITAR-TASS/. Parliament-appointed Prime Minister Arseny Yatsenyuk said Russia’s decision to abolish the zero export duty on gas for Ukraine was “politically motivated” and “absolutely unacceptable”.

He did not specify, though, what he meant exactly but said “we expect Russia to continue to exert pressure on the ‘gas front’, including by limiting gas supplies to Ukraine”.

Earlier in the day, Russian Prime Minister Dmitry Medvedev signed a resolution cancelling the zero export duty on natural gas for Ukraine.

The resolution will enter into force 30 days after official publication and will apply to relations that arose from April 2, 2014.

At a meeting with Gazprom CEO Alexei Miller, Medvedev said he was planning to sign such a resolution following the termination of the agreement with Ukraine on the Russian Black Sea Fleet.

“I am adopting a decision to cancel Resolution No. 291 of 30 April 2010. This decision has direct and immediate consequences for Gazprom’s relations with our Ukrainian partners and consumers. You should be guided by the generally established rates of export customs duties on gas without any discounts or preferences,” Medvedev said.

The abolition of the zero duty will automatically raise the price of gas for Ukraine from April 2014 to 485 U.S. dollars per 1,000 cubic metres, an increase of more than 200 U.S. dollars from the price that was used until now.

In December 2013, Russian Gazprom and Naftogaz Ukrainy signed an addendum to the gas agreement in effect from January 19, 2009, under which the price of Russian natural gas for Ukraine was to be reduced by one-third to 268.5 U.S. dollars per 1,000 cubic metres from January 1, 2014, compared to 410 U.S. dollars per 1,000 cubic metres in the fourth quarter of 2013.

Moscow and Kiev also agreed that the discount would remain in effect as long as the key conditions were met, specifically timely payments for current supplies and repayment of debts.

At the end of the first quarter of 2014, Gazprom said it would have to raise the price of gas for Ukraine by more than 100 U.S. dollars to 385.5 U.S. dollars per 1,000 cubic metres because Ukraine had failed to pay the debt for the gas delivered in 2013 and had not made payments for current supplies.

In March, Russia supplied 1,956 million cubic metres of gas to Ukraine and “has not received a kopeck” for it so far. “The debt has increased and exceeded 2.2 billion U.S. dollars. The situation is not improving. It is actually getting worse,” Miller said.

The new rise in the price of gas by another 100 U.S. dollars to 485.5 U.S. dollars per 1,000 cubic metres announced on April 3 is a result of the abolition of the zero export duty on gas for Ukraine.

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