Russian natural gas finally flowed into Europe once again Tuesday, after Moscow and Kiev pulled back from an energy war that drastically reduced supplies to many nations for two tough winter weeks.
But the resolution looked more like a cease-fire than a permanent peace, with no guarantee against renewed hostilities between Russia and Ukraine, two former Soviet neighbors with sharply contrasting views of the future.
From later on in the article…..
Ukraine is to receive gas at a 20 percent discount from this year’s average European price, which Russia says is $450 per 1,000 cubic meters. That price is likely to decrease as the effect of slumping oil prices kicks in, but it still means a hike from the $179.50 Ukraine paid last year.
Russia pays the same amount as last year to ship the gas through Ukraine’s pipelines. But in 2010, both countries are to pay market prices — Ukraine for the Russian gas it uses and Russia for the transit of gas to Europe.
Any price increases will further cripple Ukraine’s inefficient economy, already badly hurt by the global financial crisis. The office of Ukrainian President Viktor Yushchenko — Tymoshenko’s political rival — already has criticized the deal.
With the ink barely dry, Gazprom chief Alexei Miller suggested Ukraine might not be trusted to pay higher prices.
This is a complete defeat for Ukraine. But as the head of Gazprom cynically notes, it does not really matter. Ukraine is going to go broke in any case no matter what. It does not matter what they charge you when you know you can’t pay the bill.