Russian gas giant Gazprom has announced it is ending a gas discount enjoyed by Kiev in a major blow for the Ukrainian economy, as NATO foreign ministers prepared to forge a response to Russia’s intervention in Crimea.
Ukraine on Monday reported a partial withdrawal of Russian troops from its eastern border amid growing signs that the Kremlin is ready to defuse the worst East-West stand-off since the Cold War.
But tensions still remained high and Russia appeared to resort to the familiar tactic of using Gazprom to put pressure on the troubled Ukrainian economy.
The crisis is at a critical juncture as Ukrainian politicians jockey for position ahead of May 25 presidential elections and tentative diplomacy gets under way between Moscow and the West to find common ground after the fall of president Viktor Yanukovych.
Ukraine will now pay $US385.5 dollars per 1000 cubic metres of gas from the previous cut rate of $US268.5, Gazprom chief executive Alexei Miller said.
“The discount will no longer apply,” he said in a statement on Tuesday. “This is due to the inability of the Ukrainian side to pay for debts from 2013 and realise full payments for current deliveries.”
The discount had been agreed between Yanukovych and President Vladimir Putin in December 2013 as a form of financial aid to the former regime.
The price hike – although widely expected – is a new blow to the Ukrainian economy which needs an international rescue to stave off the risk of default.
With the situation still volatile in Kiev, a member of the radical Ukrainian nationalist group Pravy Sektor opened fire in central Kiev late on Monday.
Three people, including the deputy leader of the capital’s administration, Bogdan Dubass, were wounded, the interior ministry said.
Interior Minister Arsen Avakov said the gunman was apprehended two hours after the incident.
But meeting a key demand posed by both the West and Russia, Ukraine’s parliament on Tuesday voted to disarm all self-defence groups that had sprung up across the country during its political crisis.
“The Ukrainian people are demanding order,” acting president Oleksandr Turchynov said. “Those who carry arms – besides the police, the security services and the national guard – are saboteurs who are working against the country.”
NATO foreign ministers will gather in Brussels on Tuesday as the defence alliance seeks to reinforce its eastern frontier after Russia’s takeover of Crimea and amid concerns about its emboldened foreign policy.
In a regular two-day meeting of the 28 ministers, including US Secretary of State John Kerry, NATO will confirm the suspension of co-operation with Moscow, a decision made on March 5 after Russian troops grabbed Crimea from Ukraine.
“Reassuring allies is most important for NATO,” said Douglas Lute, the US ambassador to the Brussels-based Western alliance, in a pre-meeting briefing.
NATO has not ruled out the possibility of placing permanent military bases in the Baltic countries – breaking a promise made to Russia in the 1990s that it would keep permanent troops out of new member countries that border Russia.
“We cannot do business as usual with Russia,” Lute said.
“It is clear that Russia has not played by the rules, has not been consistent with our partnership … so we can review our own rules.”
Over the weekend, General Philip Breedlove, NATO’s supreme allied commander, was sent back to Europe early amid what the Pentagon called Russia’s “lack of transparency” over the Ukraine crisis.
Ukraine and the US have accused Russia of massing thousands of troops near the border and have expressed concern that Moscow intends to seize southeastern parts of Ukraine with large populations of ethnic Russians following the Crimea takeover.
But German Chancellor Angela Merkel’s office said Putin had personally informed her of the troop pullback in a telephone conversation on Monday, while her foreign minister, Frank-Walter Steinmeier, called the move “a small sign that the situation is becoming less tense”.
The apparent easing of Moscow’s position was offset by an unannounced visit to Crimea by Prime Minister Dmitry Medvedev – the most senior Russian official to visit the Black Sea peninsula since it voted on March 16 to come under Kremlin rule.