Russia cuts off Ukraine gas supply.

[Sal UK]

01/01/2006 14:02

Russia has cut off gas supplies to neighbouring Ukraine in a dispute that could hit deliveries to other parts of Europe.

The Russian state-owned supplier, Gazprom, said it had begun reducing pressure in the pipeline supplying Ukraine after Kiev refused to pay the increased price Moscow was demanding.

"In this situation, which is the fault of the Ukrainian side, we have been forced to start reducing pressure in the pipeline to Ukraine," said Gazprom spokesman Sergei Kupriyanov.

Gazprom supplies 25 percent of western Europe's gas - most of it through Ukraine.

It insisted deliveries to western Europe would not be affected but Italy's gas importer said Gazprom had warned it that disruption was possible.

Though Britain should be largely unaffected by the dispute, consumer watchdog Energywatch has warned that energy firms could exploit fears over its impact to hike prices further.

Energywatch chief executive Allan Asher hit out at rises already being made, and suggested prices could escalate still more following Moscow's decision to cut the flow of gas to its neighbour in a move that has caused political outrage.

Though Russia says it is purely a business dispute, there are concerns that the gas cut-off is being used as a political weapon against Ukraine's Western-leaning president, Viktor Yushchenko.

.Source: NTLWorld News.

I think it is a political move myself.