Ukrainian Prime Minister warns of possible ‘gas war’ with Russia

During the Normandy Format summit, Ukraine achieved the task before it and was able to broach the topic of gas transit over and above the discussion of the situation in the Donbas, said Ukrainian Prime Minister Oleksiy Honcharuk, who warned that future negotiations could prove difficult.

“We did not agree on a contract, but that was not supposed to happen in Paris. Ukraine will continue to negotiate on gas, it could be difficult, it could be with a gas war,” Honcharuk wrote on Facebook.

The prime minister noted that Ukraine is fully prepared for such a conflict. The country’s reservoirs are full, and the government’s position is based on a ruling by the Stockholm Arbitration Institute, and has received the EU’s support, whereas the Nord Stream 2 pipeline, which was meant to become Russia’s alternative transit route, has not yet been completed.

“We need a long-term contract. We won’t give away any debt. One of the options that is being considered is to receive the debt through gas,” observed Honcharuk, who called the summit in Paris a “clear diplomatic success” for Ukrainian President Volodymyr Zelensky.

Earlier on Tuesday, Zelensky himself said that during the talks with Russian President Vladimir Putin, he had managed to address the issue of the $3 billion in compensation awarded to Naftogaz by the Stockholm Arbitration Institute.

“We are willing to take gas. It’s a compromise we are willing to make,” explained Zelensky, noting that a new gas transit contract would have to be signed for longer than one year.

Previously, Yuriy Vitrenko, a director at Naftogaz, warned that if such a contract is not signed, Gazprom could “shut the valve”. According to Vitrenko, Naftogaz itself “cannot and will not shut the valves, stopping the flow of gas”.

At the start of March 2008, Gazprom reduced its gas supply to Ukraine by 50% due to the absence of a contract with Naftogaz. However, Kyiv did not acknowledge the Russian gas received in 2008, and compensated for the reduced supply by transiting less gas to Europe. By the end of 2008, Moscow estimated that Ukraine owed it $2.1 billion. The parties could not agree on the terms of a contract for 2009, and so the gas supply to Ukraine was stopped on January 1, and within the week, so was gas transit to Europe through the country. On January 19, 2009, after negotiations between then Russian and Ukrainian Prime Ministers Vladimir Putin and Yulia Tymoshenko, new gas transit and supply contracts were signed, which expire on December 31, 2019.

  Naftogaz, Gazprom, Russia