EU Energy Chief Calls For Compromise in Ukraine-Russia Gas Crisis Talks

Ukraine should pay a large chunk of its gas debt to Russian energy giant Gazprom while Russia must offer a fair price for deliveries, the European Union's commissioner for energy said on Friday.

Speaking ahead of EU-brokered talks in Berlin, Günther Oettinger told German radio station Deutschlandfunk that the volume of gas received by Kiev from November to the end of May was now clear.

"The price for the months of January, February, and also now, is disputed so Ukraine has to explain today that it will make, or has already made, a first payment, a significant amount, a high three-digit million amount in dollars," he said.

"Those who get gas must pay," he added.

Oettinger described the price that Russia is demanding from Ukraine as "unacceptable" and influenced by politics.

Russia's state-controlled energy giant Gazprom insists that Ukraine pay $485 per 1,000 cubic metres for gas delivered, while Ukraine is demanding a price of $268.50 per 1,000 cubic metres.

The gas dispute arose when Ukraine's pro-Russian former president was ousted from office in February, following months of street protests across the country.

Moscow had dropped the price it charges Kiev for gas to $286.50 per 1,000 cubic metres after former Ukrainian President Viktor Yanukovych rejected an EU deal in favour of strengthening trade ties with Russia.

However, Gazprom reinstated the higher price of $485 per 1,000 cubic metres after Yanukovych fled Ukraine and was replaced by a pro-European interim prime minister and government.

Oettinger said Ukraine should pay the same price as other European countries for gas in line with market conditions.

"After Ukraine has made a down payment," he said, "we should expect Russia to guarantee a fair offer, a fair price, in future."

Friday's talks mark the final chance for the sides to reach an agreement amid Russian threats that it will cut off gas supplies to Ukraine.

Gazprom set a deadline of the end of this month for Ukraine to make a pre-payment for June gas deliveries and said it would only deliver gas which has been paid for after the deadline.

The dispute has raised fears among European countries that gas supply to the continent could be affected.

Europe depends on Russia for a third of its gas needs, around half of which flow through pipelines in Ukraine.

Oettinger said the EU would be affected in the medium-term if Russia halted gas deliveries to Ukraine.