Ukraine rejects Russia’s gas price cut, hopes for lower

Russia’s proposal of a $100 reduction on the price for 1,000 cubic meters of gas does not appeal to Ukraine, Prime Minister Arseniy Yatsenyuk said Wednesday, according to RIA Novosti.

“The Russians have proposed to give a $100 discount on the gas price…[we are aware that] the reduction is established by the decision of the Russian government, and the government can withdraw this decision, this is the reason why our position was and remains the same: changing the 2009 contract,” Yatsenyuk said.

The minister added that Ukraine is ready to pay off all its gas debts at the market price fixed by Kiev at the level of $268 per 1,000 cubic meters.

“We are ready to pay off all the debts at market price,” Yatsenyuk said.

According to the minister, Kiev’s position remains unchanged and insists on rewriting the contract.

Ukraine’s debt for Russian natural gas began to accumulate as early as November 2013, when a political crisis broke out in the country. Up until recently, the only full payment that Russian gas giant Gazprom received was for January deliveries, when on June 2 Ukraine’s Naftogaz transferred $786 million for the February-March 2014 deliveries.

Kiev was given until June 10 to repay at least $4 billion of its debt to Moscow, after Russia postponed the original deadline of June 2 twice — first by one week and then by adding an extra day on the grounds of Monday being a public holiday in Ukraine.

Russia could potentially cut off the gas supply to Ukraine, which is a transit country for its gas exports to Europe, starting Wednesday. It also warned it considered switching to a prepayment system, ultimately supplying exactly those volumes of gas to Ukraine the country has paid for.

Gazprom’s CEO Alexei Miller said earlier that the Russian energy giant had extended the deadline for Ukraine to pay its gas bill until June 16 as the two countries are set to continue their gas price consultations later on Wednesday.