Medvedev says no solution yet to gas crisis
MOSCOW (Reuters) - Russian President Dmitry Medvedev said on Saturday there were "still no results" from efforts to end a dispute crippling gas supplies to eastern Europe, dashing hopes of a quick end to the 11-day-old crisis.
"Unfortunately, and I would like to underline this, all the efforts have so far yielded no results," Medvedev said as he opened a Kremlin meeting of nations involved in the dispute.
At a news conference afterwards, the Russian leader reiterated that Kiev had to agree to European-level prices for its gas supplies, more than double the level it is now paying. Ukraine says it cannot afford this.
Earlier in the day, Russian Prime Minister Vladimir Putin did not hold planned talks with his Ukrainian counterpart Yulia Tymoshenko.
There was no official explanation for the failure to negotiate but a source close to the Russian side said it appeared Tymoshenko lacked the necessary mandate to discuss a solution and had come to Moscow "empty-handed."
Medvedev said Putin and Tymoshenko would continue talks on resolving the crisis. Asked whether he believed the Ukrainian premier had a mandate, he said he hoped she did.
"I sincerely hope that Yulia Tymoshenko ... has all of the necessary mandates to represent Ukraine," he told reporters.
Tymoshenko is locked in a political battle with her domestic rival, Ukrainian President Viktor Yushchenko. This has complicated efforts to find a solution to the dispute.
Russia invited heads of government of all countries buying or transporting its gas to what it called an "International Conference" in Moscow on Saturday but most stayed away.
The Czech presidency of the European Union had urged member states not to attend, so that Brussels could speak with one voice for them. In the event, Slovakia was the only EU member to come, apart from the Czechs.
A spokesman for Russian state-controlled gas behemoth, Gazprom, said he hoped an agreement on the transit of gas to Europe would be signed with Ukraine on Saturday.
"Yes, we wait, we hope that today will be a decision," Gazprom spokesman Sergei Kupriyanov said when asked by reporters if a deal with Ukraine could be signed on today.
Putin had said on Friday after talks in Germany that Moscow was nearing a deal to restart gas deliveries to European customers.
A key hurdle to ending the dispute appeared to have been overcome when a consortium of European gas companies said they had agreed to supply enough gas to fill the empty pipeline and restore pressure so that exports could resume.
But the key sticking point in the row -- the price Ukraine must pay for its own supplies this year -- remains unsolved.
EUROPEAN SUPPLIES
Russia cut off gas supplies to Ukraine on January 1 after Kiev refused to agree a big price rise and over unpaid bills. Six days later, Gazprom stopped sending gas for export through Ukraine, accusing Kiev of stealing exports destined for Europe.
The row has angered the European Union, which gets about a fifth of its gas from pipelines that cross Ukraine, and left many countries in eastern and southern Europe with no supplies in the depths of winter.
The dispute, one of the worst disruptions in the history of Russian gas supplies to Europe, has raised doubts over Russia's reputation as a reliable energy supplier and added to political divisions in Ukraine.
The row takes place against a backdrop of strained political ties between Moscow and Kiev. Russia has been angered by Yushchenko's aspiration to join NATO and by Kiev's support for Tbilisi during the Russian-Georgian war in August.
Gazprom says Ukraine should pay European-level prices of $450 per 1,000 cubic metres (tcm) of gas for 2009, up from $179.5 per tcm in 2008.
But Ukraine, heading into the worst recession for a decade, has said it can only afford $201 per tcm. Ukraine also wants an increase in the fees it gets from Russia for the transit of gas to Europe if the price of gas is raised.
Tymoshenko, a former gas trader, said on Friday there should be no intermediaries in the gas trade between Russia and Ukraine and ruled out any sell-off of Ukraine's pipelines. She also demanded that Ukraine speak with one voice in the negotiations.
The row has focussed minds in Europe about the need to find new routes for gas but experts say any solution would take years to build and Gazprom says EU dependency on Russian gas is forecast to increase over coming years.