Wednesday, January 7, 2009

RUSSIA TURNS OFF GAS SUPPLIES

Independent, UK - Fears of a deep chill spread across Europe after a row between Russia and Ukraine over gas prices cut supplies to the rest of the continent on a day of plummeting temperatures and heavy snowfalls.

The European Union said the situation was "completely unacceptable" as thousands of businesses were urged to switch fuels, and households struggled to keep warm in sub-zero temperatures. But there was no sign of an end to the standoff between Russia's energy monopoly Gazprom and Ukraine, locked in battle since New Year's Day.

Gazprom stopped pumping gas to Ukraine for domestic consumption on 1 January after the two countries failed to agree on a fixed price for 2009. The pipelines that cross Ukraine also carry gas to Europe but that continued to flow, until Moscow accused Ukraine of siphoning off Europe's fuel and Prime Minister Vladimir Putin retaliated by ordering Gazprom to cut EU-bound exports by the amount being stolen.

Yesterday Russia stopped gas supplies through Ukraine to Bulgaria, Hungary, Greece, Turkey, Romania, Serbia, Bosnia and Macedonia. The government of Slovakia declared a national emergency; Austria and Italy reported falls of 90 per cent; France said Russian supplies had tailed off 70 per cent, and Germany also reported a decline although did not quantify it.

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