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    Russian gas price hike could hit Ukraine hard - former PM

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    A hike in natural gas prices for Ukraine in 2008 could hit the country's economy hard, Ukraine's former prime minister and a leader of the pro-presidential bloc said on Tuesday.

    KIEV, December 4 (RIA Novosti) - A hike in natural gas prices for Ukraine in 2008 could hit the country's economy hard, Ukraine's former prime minister and a leader of the pro-presidential bloc said on Tuesday.

    On Tuesday, Moscow and Kiev agreed that as from January 1, 2008, the price of natural gas on the Russian-Ukrainian border will be set at $179.5 per 1,000 cubic meters, energy giant Gazprom said.

    "It is a very serious challenge for our economy," Yuriy Yekhanurov, leader of the Our Ukraine-People's Self-Defense bloc said.

    Since January 1, 2007, Ukraine has only been buying natural gas from Central Asia, mainly Turkmenistan, at a price of $130 per 1,000 cubic meters.

    Gazprom said earlier the gas price for Ukraine in 2008 could be raised to $160 per 1,000 cubic meters on the condition that European market prices were accepted by 2011. But then, in late November, it agreed to raise the price of Turkmen gas from $100 to $130 in the first half of 2008 to $150 in the second.

    Turkmenistan pumps gas via a Russian-controlled pipeline network, but has been considering diversifying export routes.

    Russian-Ukrainian gas talks have until lately stalled for a number of reasons, including the failure of Turkmenistan, the second largest gas producer after Russia in the post-Soviet Commonwealth of Independent States, to set a future gas price.

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