KIEV (Reuters) - Ukrainian Prime Minister Yulia Tymoshenko on Wednesday described as a "great victory" a deal with Russia on gas supplies which avoided a threatened cut in shipments and eliminated intermediaries in trade.
The row between the two former Soviet states had sentjitters through customers in Europe, who feared it couldescalate into a repeat of New Year 2006, when a pricing disputedisrupted shipments to EU countries.
"The gas talks were a great victory for the democraticteam," Tymoshenko told a cabinet meeting after the agreementwas clinched in Moscow on Tuesday, minutes before aMoscow-imposed deadline on Ukraine to pay arrears or facesupply cuts.
"We are ready to begin making payments for gas once we getthe agreements."
The deal was reached during talks between UkrainianPresident Viktor Yushchenko and Kremlin leader Vladimir Putin.
Tymoshenko, who remained in Kiev, has long denounced asunnecessary and costly the use of intermediaries in the gastrade, particularly RosUkrEnergo, the Swiss company whichoversees gas shipments to Ukraine.
Tymoshenko had been charged by the president with findingsolutions to the arrears problem in the run-up to the deal.
Alexander Burgansky, an analyst from Renaissance Capital inMoscow, welcomed the deal for easing tensions, though detailswere still to be clarified.
"Interruptions of gas supply have been avoided, suggestingthat the relationship has moved to a more civilised level withboth parties acknowledging the importance of reliable gassupplies and the role both countries play within the broaderEuropean energy markets," he said.
Tymoshenko returned as prime minister in December at thehead of a government made up of advocates of the 2004pro-Western "Orange Revolution."
But in the two months since being restored to office,differences have emerged between her and Yushchenko, withYushchenko far less insistent in wanting to abandon the use ofintermediaries in the gas trade.
(Reporting by Natalya Zinets, Writing by Ron Popeski;Editing by James Jukwey)
