Russian PM plays down talk of gas wars, warns Ukraine on EU

Russian PM plays down talk of gas wars, warns Ukraine on EU
Russia's Prime Minister Dmitry Medvedev looks on during an interview with Reuters in Moscow, October 31, 2013.

MOSCOW - Russian Prime Minister Dmitry Medvedev said he saw no reason for Moscow to cut gas supplies to Ukraine over an unpaid bill for now, playing down talk of an imminent "gas war" that might disrupt gas flows to Europe.

In an interview with Reuters, he denied Russia's demands for payment had anything to do with opposition to Ukraine signing agreements with the European Union this month which would mark a historic shift away from former imperial master Moscow.

But the 48-year-old former president said the "special relationship" between the two former Soviet republics would change if Ukraine moved closer to Europe and that Kiev should no longer come to Moscow seeking loans.

Russian gas export monopoly Gazprom said on Tuesday that Ukraine, which is dependent on supplies of Russian gas, had failed to settle a $882 million bill for August deliveries and demanded it be paid urgently.

Medvedev said they had yet to pay.

"We understand that they have economic difficulties, but they still have to pay, especially after we gave them loans and financed transit," Medvedev said in the interview on Thursday, adding the transit fees cost billions of dollars.

"It's the law - you have to pay for delivered goods. It's normal practice around the world. Let them pay."

Medvedev said Russia could resort to a system of advance payments if Ukraine did not respond to its demands.

As it nears a payment crunch to service its debt over the next 18 months, Ukraine has asked for leniency from Russian creditors, including trying to extend the term of a $2 billion loan from Russia's Gazprombank by five years. Just last month, Putin said Russia would lend $750 million to Ukraine.

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