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Russian natural gas keeps flowing to Europe - France

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Russian natural gas was reaching Europe in full amounts on Friday a day after Russia cut off gas supplies to Ukraine in a contract dispute and toughened its stance on prices.
PARIS, January 2 (RIA Novosti) - Russian natural gas was reaching Europe in full amounts on Friday a day after Russia cut off gas supplies to Ukraine in a contract dispute and toughened its stance on prices.

French Foreign Ministry spokesman Eric Chevallier told a news conference on Friday that both Russia and Ukraine were so far honoring their pledge to keep gas flowing to European consumers.

Russia cut off natural gas supplies to Ukraine on Thursday after last-ditch talks on a 2009 contract failed late on Wednesday, but increased shipments to European states.

Gazprom also said late on Thursday it would sell natural gas to Ukraine at the European market price of $418 per 1,000 cu m in 2009, following Ukraine's rejection of a considerably lower price.

Gazprom earlier offered Ukraine a price of $250 per 1,000 cu m for gas in 2009, about half the current average price in Europe. Ukraine, which paid $179.5 last year, said it was prepared to pay $201, however.

Gazprom said on Wednesday that Ukraine's national oil and gas company Naftogaz had threatened in a letter addressed to the gas giant that it could start confiscating Russian gas meant for European Union consumers after January 1, if no new contract was agreed for 2009.

The EU urged on Thursday both sides to engage in further talks. "All existing commitments to supply and transit must be honored," the EU president, the Czech Republic and the European Commission said in a joint statement.

Frequent gas disputes between Moscow and Kiev have raised concerns in Europe about the reliability of Russia as a supplier. Ukraine transits about 80% of Russian gas, a major source of revenue for Moscow, bound for the EU. Europe buys a quarter of its gas needs from Gazprom.

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