Updated on 08:26 p.m. Moscow Time
MOSCOW, September 3 (RIA Novosti) – Moscow will resume gas cooperation with Ukraine only when Kiev repays its “astronomical” debt to Russia in full and agrees to the average annual price of $385 per 1,000 cubic meters of gas, Russian Prime Minister Dmitry Medvedev said Wednesday.
“We are ready to discuss ways to resume our gas cooperation with Ukraine, a country that owes us. However, two preconditions must be fulfilled. Firstly, the existing debt, which has already risen to astronomical figures, must be repaid in full. And, secondly, even if the price is subject to seasonal revisions, the average annual price with a $100 discount… must be $385 per 1,000 cubic meters,” Medvedev told reporters, commenting on a recent statement by his Ukrainian counterpart Arseniy Yatsenyuk.
The Russian prime minister added that if Ukraine rejects the proposed $100 discount, the resulting price of $485 per 1,000 cubic meters of gas will suit the Russian side perfectly.
Earlier in the day, Ukrainian Prime Minister Arseniy Yatsenyuk said that Kiev offered Moscow two variants on gas pricing that would be set at $300 per 1,000 cubic meters during the low season and $380 during the winter season, or tie the gas prices to the spot market in Europe.
Yatsenyuk added that Ukraine does not need a discount on gas, but would not pay Russia $500 per 1,000 cubic meters.
Three-party consultations between Russia, Ukraine and the European Union on gas issues, have been ongoing since April, but have yet to yield any significant results.
Russia offered Ukraine a $100 discount on the price for each 1,000 cubic meters, bringing the total price down to $385 per 1,000 cubic meters of gas, but Ukraine refused to agree on a deal.
On June 16, after several unsuccessful rounds of talks, Russian gas company Gazprom was forced to implement a prepayment scheme for gas supplies to Ukraine over its accumulated debt.
As of today, Kiev’s gas debt to Russia is estimated to be more than $5.3 billion.