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Gazprom, the Russian energy giant, 51 percent of which is owned by the state, provides about a quarter of Western Europe's natural gas. Under a system begun in the Soviet era, 80 percent of Russia's exports to Europe have passed through Ukraine. Gazprom said it had reduced the flow to equal the volumes it agreed to provide to Western countries, minus what the company provides for the Ukrainian domestic market.
On the same day it throttled back its gas to Ukraine, Russia assumed the chairmanship of the Group of 8, the club for the world's large developed economies, promising to push the theme of "energy security.
The –06 Russia–Ukraine gas dispute was between Ukrainian state-controlled oil and gas company Naftogaz Ukrainy and Russian national gas supplier Gazprom. The disagreements concerned natural gas supplies, prices and debts. The –06 Russia–Ukraine gas dispute was between Ukrainian state-controlled oil and gas company Naftogaz Ukrainy and Russian national gas supplier.
Sunday's early-winter cut in gas supplies to Ukraine came as an unsettling reminder that promises of energy exports are not Russia's only method of using oil and gas to further its foreign policy goals -- it can also turn off the valve of energy exports. The election of Viktor A. Yushchenko as Ukraine's president last winter pulled the former Soviet country from Russia's sphere of influence.
A gas shortage this winter could discredit him and weaken his party, with parliamentary elections coming up in March. Tellingly, President Vladimir V. Putin of Russia was personally involved in the negotiations. It was he, rather than company officials, who made the final offer of a grace period on Saturday.
A jump in Russia's utility bill to Ukraine is at the heart of the current conflict.
Ukraine's economy has depended on buying cheap energy from Russia, which provides about a third of its natural gas supply. The 11th-hour effort to head off the shutdown failed. On Sunday, Ukraine's natural gas distributing company, Naftogaz, said it had faxed a draft contract to Russia shortly after 11 p. Saturday -- agreeing to terms laid out earlier that evening by Mr.
Putin, the company said in a statement. Putin had suggested a 3-month grace period if Ukraine would agree to pay the higher prices thereafter. Gazprom, however, said Sunday the faxed reply had fallen short of demands. Kupriyanov, said on Russian television. At around 10 a. The effects were starting to be felt in Europe on Sunday night. The Hungarian natural gas wholesaler, MOL, said that deliveries from the affected pipeline were down more than 25 percent, according to Reuters, which added that in Poland, supplies dwindled 14 percent.
Polish officials said reserves were adequate for now, and the Hungarian company asked big gas consumers to switch to oil where possible.
Gazprom reduced the pressure in the gas mains leading to Ukraine at three metering stations and ceased boosting pressure in the westbound pipelines from a storage system that is designed to keep the pressure up during peak demand in the winter. It was unclear whether the impact on the other countries was a result of Gazprom's action or whether it was the result of interference by Ukraine. View all New York Times newsletters. Ignatyev, said in a telephone interview.
Prime Minister Yury I. Yekhanurov of Ukraine said on Sunday that his country was not siphoning gas from the pipeline. The State Department, expressing hope that the conflict would be resolved, said in a statement: "Such an abrupt step creates insecurity in the energy sector in the region and raises serious questions about the use of energy to exert political pressure.
As we have told both Russia and Ukraine, we support a move toward market pricing for energy, but believe that such a change should be introduced over time rather than suddenly and unilaterally. Putin has said that Russia's foreign policy will hinge on energy exports. In trips to Germany, Turkey and Japan last fall, he boldly promised not only a secure supply of fuel for the West, but also that Russia could become a much larger energy exporting nation in the years ahead. He pushed Germany to endorse a multibillion-dollar underwater gas pipeline in the Baltic Sea.
Gazprom is hoping to extend the pipe to Denmark, Belgium and Britain. Gazprom is also in talks with a short list of five major energy companies to develop a huge gas field in the Barents Sea, far above the Arctic Circle off western Russia, hoping to ship significant quantities of liquefied natural gas directly to the United States, the world's largest energy consumer.