[Ohio UZO News] Ukraine: AP; Editorials - WP, WSJ, NYT

[Deychak, Orest]

There have been numerous articles about the Russia-Ukraine gas crisis
since my last mailing of December 31.  Included here is one article on
the latest developments as well as three editorials that appeared in
leading US newspapers while I was away.

 

Also, please feel free to let me know if you no longer wish to be
included on this list.

 

OD

 

Associated Press

Russia's Gazprom to resume natural gas shipments to Europe through
Ukraine on Tuesday 

By MARIA DANILOVA 

Associated Press Writer

12 January 2009

10:27

KIEV, Ukraine (AP) - Russia's state-run monopoly Gazprom
<javascript:void(0);>  announced it will resume shipping natural gas
Tuesday to Europe, where tens of thousands of homes and buildings have
been left without heat in freezing weather.

Gas supplies will be restarted at 0700 GMT (2 a.m. EST) "if there are no
obstacles," Gazprom <javascript:void(0);>  deputy chairman Alexander
Medvedev said in Brussels.

The shift came after Ukraine signed off on an EU-brokered deal that sent
teams of EU, Russian and Ukrainian monitors in to track the movement of
Russian gas through Ukraine's vast pipeline system. Gazprom
<javascript:void(0);>  had shut off deliveries last Wednesday, accusing
Ukraine of siphoning off gas intended for Europe, a charge that Ukraine
denies.

"As soon as they (the monitors) are at the control points, and we are
sure that they can control the transit of our gas, Gazprom
<javascript:void(0);>  will pump gas to Ukraine's gas transit system to
be shipped to European customers," Prime Minister Vladimir Putin said at
a Cabinet meeting Monday.

Russia supplies about one-quarter of the European Union's natural gas,
80 percent of it shipped through Ukraine, and the disruption has come as
the continent is gripped by freezing temperatures.

The gas cutoff has affected more than 15 countries, with Bosnia,
Bulgaria, the Czech Republic, Hungary, Serbia and Slovakia among the
worst hit. Sales of electric heaters have soared and thousands of
businesses in eastern Europe have been forced to cut production or even
shut down.

Relief will not come immediately, however. It will take 24 to 30 hours
for gas to reach European customers once Russia resumes pumping, EU
Energy Commissioner Andris Piebalgs said.

Russia was still not sending natural gas to Ukraine for domestic
consumption. The two neighbors remained deadlocked over the price
Ukraine should pay for gas in 2009 and the amount Russia should pay for
transporting gas through Ukraine's pipelines. Russia stopped supplying
gas to Ukraine on Jan. 1 over the price dispute.

Teams of EU monitors and officials from Naftogaz, Ukraine's state-run
energy company, were already at six major gas transit stations on
Ukraine's border with European countries and at three units on the
Russian-Ukrainian border, according to Naftogaz.

Gazprom <javascript:void(0);>  would not say when its observers would be
in place.

"The EU, Russia and Ukraine will each name 25 monitoring experts," said
Deputy Prime Minister Igor Sechin. "This will be sufficient to monitor
the supply of gas at all monitoring points."

Ukraine first signed the agreement early Sunday, but Russia declared it
invalid after Ukraine attached additional conditions, including being
able to use Russian gas to pump supplies across its vast territory. 
Gazprom <javascript:void(0);>  says Ukraine must pay for that so-called
technical gas, but Kiev insists it won't pay until the two countries
strike their own gas deal and Russia restores gas deliveries to Ukraine.

Ukrainian government officials clarified the deal Monday and said the
declaration was not legally binding.

"We will continue to use (technical) gas from the Russian Federation,"
Prime Minister Yulia Tymoshenko told reporters. "We will be able to pay
for it when contracts are signed and we receive payment for transit."

Gazprom <javascript:void(0);>  has lost about $800 million in revenue
because of the disruption of supplies, Putin told German ARD television.

The anger toward Russia for shutting off supplies was particularly acute
in eastern Europe, where many residents spent money they really couldn't
afford on electric heating and temperatures plunged to -14 C (6.8 F) in
places like Sarajevo, the Bosnian capital.

"We switched our heating from gas to electricity," said Snjezana Kordic,
a 51-year-old Sarajevo resident. "We will never again depend on the mood
of the Russians."

The Washington Post

Editorial

Mr. Putin's Cold War; The Russian leader orders the suspension of gas
deliveries to Europe. Is Ukraine really to blame? 

8 January 2009

FINAL

A14

RUSSIA HAS been piously insisting that its latest midwinter cutoff of
gas deliveries to Ukraine -- and now the rest of Europe -- is the result
of a commercial dispute and not a part of Moscow's long-standing
campaign to undermine Ukraine's pro-Western government. So why, then,
would Russian state television have devoted prime time on both Monday
and Tuesday to broadcasting staged meetings at which Prime Minister
Vladimir Putin ostentatiously vilified Ukraine's president and ordered
the state gas company to cut off deliveries?

Mr. Putin's televised "working sessions" with Alexei Miller, the
chairman of the state gas monopoly Gazprom <javascript:void(0);> , were
scripted with ludicrous heavy-handedness. In each, Mr. Putin
disingenuously inquired about details of Russia's dispute with Ukraine,
and Mr. Miller replied by portraying the Ukrainian government as
thieving, deceptive and unreliable. On Monday, Mr. Putin cynically
sympathized with the consumers of Ukraine, then ordered a reduction in
the gas that transits Ukraine to other European countries. On Tuesday,
he decreed that the pipeline be shut down altogether -- a measure that
left not just Ukraine but a dozen other countries without energy
deliveries.

Is this really the way to resolve what has been a byzantine bilateral
argument over prices and transit fees? Of course not -- but that's not
Mr. Putin's objective. The real aim is to advance Russia's aggressive
strategy of using its energy exports to divide Europe and undermine
those states it still considers its rightful subjects, beginning with
Ukraine. Listen to Mr. Putin's ambassador to NATO, Dmitry Rogozin: "It's
clear that if Europe wants to have guaranteed natural gas supplies, as
well as oil in its pipelines, then it cannot fully rely on its wonderful
ally, Mr. Yushchenko." Viktor Yushchenko was democratically elected
Ukraine's president in 2004 after a Moscow-backed vote-rigging operation
backfired. Like Georgian President Mikheil Saakashvili, the Ukrainian
leader strongly favors the entry of his country into NATO. Mr. Putin
responded to Mr. Saakashvili with an invasion last August; now he has
launched an offensive against Mr. Yushchenko.

Some in Europe will no doubt buy Mr. Rogozin's argument, just as they
blame Mr. Saakashvili for the Russian troops still entrenched on
Georgian territory. Like its Georgian counterpart, Ukraine's government
has many weaknesses, which Mr. Putin has ruthlessly exploited. But the
real message of this cold week is the same that European governments
have repeatedly received -- and largely ignored -- in recent years. Mr.
Putin's regime plainly intends to use Europe's dependence on Russian
energy to advance an imperialist and anti-Western geopolitical agenda.
The only rational response is a dramatic acceleration of the European
Union's search for alternative sources of energy -- and greater support
for those countries that Russia seeks to subjugate. 

  <javascript:void(0)> 

REVIEW & OUTLOOK (Editorial)

The Winter Gas War 

7 January 2009

A12

Five months after sending Russian tanks into Georgia, Vladimir Putin has
turned his sights to another pesky democratic neighbor, Ukraine. His
weapon of choice this time is natural gas.

Try to ignore the noise about transit fees, back payments and market
prices. Here's the salient fact about the conflict between Russia and
Ukraine over gas supplies: Russia's strongman is wielding the energy
club to undermine the pro-Western government in Kiev and scare the
European Union into submission. The strategic stakes are as great as in
Georgia last summer.

Mr. Putin, who has no formal oversight role at Gazprom
<javascript:void(0);> , nonetheless ordered a 15% cut in gas deliveries
to Ukraine on New Year's Day, amid a contractual dispute over prices.
Russia used the same crude pressure tactic in January 2006, when Gazprom
<javascript:void(0);>  first cut supplies and destroyed its once stellar
reputation for reliability.

But the impact down the line on Europe, which gets a fifth of all its
gas through Ukraine, appears more pronounced than three years ago. Amid
freezing winter temperatures, six European countries yesterday reported
a halt in gas supplies while five others saw significant reductions.
Tens of thousands of people were left without heat, including two
mid-sized cities in Bulgaria. Here in the U.S., heating oil prices
jumped 3.3% on expectations that Europeans would switch from natural gas
to warm their homes.

Moscow learned from 2006 and launched a propaganda blitzkrieg in the
run-up to this winter war. A lobbying firm in Brussels was hired to
reassure Continentals about the security of their supplies -- at least
until yesterday -- and pin the blame on Ukraine's refusal to pay a
"market price" for natural gas and keep up payments. The Russians even
created a Web site -- www.gazpromukrainefacts.com -- that yesterday
noted that, "Ukraine is responsible for everything that has happened."

Ukraine isn't blameless here. In 2006, the Kiev government was all too
happy to create a murky -- many assume deeply corrupt -- structure to
funnel billions in transit fees for Gazprom <javascript:void(0);>  gas.
Its fractious leaders resisted efforts to make the energy market
transparent or wean its economy off relatively cheap Russian natural
gas.

But the Kremlin's motivations are plainly political, not commercial. For
starters, no "market price" for natural gas exists because Gazprom
<javascript:void(0);>  happens to be a monopoly supplier to Ukraine.
Russia won't allow Kiev to make up the shortfall with supplies from
another source like Turkmenistan, which uses Russian pipelines. And
Russia continues to let its "friends," such as the dictatorship in
Belarus, buy gas on the cheap.

Normally, this sort of dispute might end up in arbitration and a
backdated settlement. The old apolitical Gazprom <javascript:void(0);>
treasured its customer relationships too much to disrupt shipment at any
price. Atop a new Russia determined to rebuild its old empire, Mr. Putin
decided to go for the jugular with Ukraine -- cutting off the gas, in
the middle of winter, just before the Orthodox Christmas.

The Kremlin's goals in Ukraine are transparent. Kiev's support for
Georgia in the August war, and its ambitions to join the EU and NATO, is
a thorn in the bear's paw. In Europe, Russia wants to reassert itself as
the dominant power in the east, feared if not respected. Germany's
establishment is all too happy to kowtow and urge the EU to do the same,
at Ukraine's expense. The EU spokesman this week could have been reading
from Gazprom <javascript:void(0);>  talking points, saying that the
block believes this is a "commercial dispute [that] has to be solved by
the two parties."

Europe and America can still turn Mr. Putin's tactical overreach into a
strategic opportunity. The "new Europeans" from the east are pushing the
EU to get serious about developing new sources of energy -- starting
with the stalled Nabucco pipeline that would cross Turkey and the
Balkans, routing Central Asian gas around Russia.

For the new Obama Administration, Mr. Putin has offered yet another
tutorial in its coming challenges in Eurasia. The President-elect's
German friends will urge him to be nice to Mr. Putin. But in the Senate
and on the campaign trail, Mr. Obama said he wanted to let Ukraine and
Georgia make their free choice to join the Western camp, starting with a
roadmap for NATO membership. The best American response to the latest
Russian provocations would be to restate that desire.

  <javascript:void(0)> 

EDITORIAL

Europe's Big Chill 

9 January 2009

Late Edition - Final

26

Three years ago, the Europeans were jolted when a gas-pricing dispute
between Russia and Ukraine briefly cut gas supplies to Europe. That led
to a lot of talk about the need for a unified stance toward Moscow --
and a rush by a few members to cut separate deals. Now that it has
happened again, and with far greater disruptions, the only surprise is
that anyone in Europe is surprised.

In this case, it's debatable as to who is chiefly responsible for this
week's sharp cut in Russian gas flowing through Ukraine. Russia is
feeling the pain of falling energy prices and is anxious to get closer
to the market price from Ukraine. Prime Minister Vladimir Putin also has
no compunctions about using energy to promote his imperial ambitions.
But Ukraine is by no means an innocent victim. Its president and prime
minister are locked in a fierce power struggle, and its energy industry
is mired in shady political and business dealings.

All this was known in 2006. Since then, neither Russia nor Ukraine has
made any effort to stabilize their gas trade -- nor have they felt any
outside pressure to do so. The Bush administration deemed it far more
important to try to get Ukraine into NATO than to press it to reform its
energy industry. Germany, France and other European nations spent all
their time currying favor with Mr. Putin, while the European Union stood
on the sidelines.

On Thursday night, the European Union announced a deal with Russia on
supervising the flow of gas through Ukraine. That would only be a
temporary fix. Europe and the United States must press both countries to
come up with a rational schedule for raising gas prices closer to market
rates -- one that doesn't bankrupt Ukraine overnight but also guarantees
Moscow a fairer deal.

Europe and Washington have leverage. Gazprom <javascript:void(0);> , the
Russian gas monopoly, badly needs investment capital, and Russia needs
the income. Ukraine wants closer ties to the West. Wielding these
levers, however, requires Europe to speak to Russia with one voice. The
incoming American administration will have to come up with a clear-eyed
approach to Mr. Putin -- something President Bush never managed.

This week's big chill is yet another reminder of why Europe needs to
reduce its dependence on Russian gas -- building more storage facilities
and finding alternative energy sources. The 100 billion cubic meters of
gas that now flow through Ukraine are roughly 40 percent of the European
Union's gas imports.

Along with the United States, the Europeans also must come up with a
strategy for moderating or containing Mr. Putin's bullying ways. Last
month, Russia's Parliament extended the Russian presidency to six years.
Most everyone -- inside Russia and out -- is now betting that Mr. Putin
will soon be back in that office.

 

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